Exhibit 4.27


 


EXECUTION COPY


 


INTERCREDITOR AGREEMENT


(2004-1)


 


dated as of March 24, 2004


 


among


 


WILMINGTON TRUST COMPANY,


not in its individual capacity


but solely as Trustee under the


JetBlue Airways Pass Through Trust 2004-1G-1,


JetBlue Airways Pass Through Trust 2004-1G-2


and


JetBlue Airways Pass Through Trust 2004-1C


 


LANDESBANK HESSEN-THÜRINGEN GIROZENTRALE,


as Class G-1 Primary Liquidity Provider,
Class G-2 Primary Liquidity Provider and as Class C

Primary Liquidity Provider


 


MORGAN STANLEY CAPITAL SERVICES INC.,


as Class G-1 Above-Cap Liquidity Provider,
Class G-2 Above-Cap Liquidity Provider and as

Class C Above-Cap Liquidity Provider


 


MBIA INSURANCE CORPORATION,


as Policy Provider


 


and


 


WILMINGTON TRUST COMPANY,


not in its individual capacity except


as expressly set forth herein but


solely as Subordination Agent and Trustee


 

















 


TABLE OF
CONTENTS


 


	
  ARTICLE I      DEFINITIONS

  	
   

  
	
  Section 1.1.

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II      TRUST
  ACCOUNTS; CONTROLLING PARTY

  	
   

  
	
  Section 2.1.

  	
  Agreement to Terms of Subordination;
  Payments from Monies Received Only

  	
   

  
	
  Section 2.2.

  	
  Trust Accounts

  	
   

  
	
  Section 2.3.

  	
  Deposits to the Collection Account and
  Special Payments Account

  	
   

  
	
  Section 2.4.

  	
  Distributions of Special Payments

  	
   

  
	
  Section 2.5.

  	
  Designated Representatives

  	
   

  
	
  Section 2.6.

  	
  Controlling Party

  	
   

  
	
  Section 2.7.

  	
  Buy Out Right

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III      RECEIPT,
  DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED

  	
   

  
	
  Section 3.1.

  	
  Written Notice of Distribution

  	
   

  
	
  Section 3.2.

  	
  Distribution of Amounts on Deposit in the
  Collection Account

  	
   

  
	
  Section 3.3.

  	
  [Intentionally Omitted]

  	
   

  
	
  Section 3.4.

  	
  Other Payments

  	
   

  
	
  Section 3.5.

  	
  Payments to the Trustees, Primary Liquidity
  Providers and Policy Provider

  	
   

  
	
  Section 3.6.

  	
  Liquidity Facilities

  	
   

  
	
  Section 3.7.

  	
  The Policies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV      EXERCISE
  OF REMEDIES

  	
   

  
	
  Section 4.1.

  	
  Directions from the Controlling Party

  	
   

  
	
  Section 4.2.

  	
  Remedies Cumulative

  	
   

  
	
  Section 4.3.

  	
  Discontinuance of Proceedings

  	
   

  
	
  Section 4.4.

  	
  Right of Certificateholders to Receive
  Payments Not to Be Impaired

  	
   

  
	
  Section 4.5.

  	
  Undertaking for Costs

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V      DUTIES
  OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC

  	
   

  
	
  Section 5.1.

  	
  Notice of Indenture Default, Indenture
  Event of Default or Triggering Event

  	
   

  
	
  Section 5.2.

  	
  Indemnification

  	
   

  
	
  Section 5.3.

  	
  No Duties Except as Specified in Intercreditor
  Agreement

  	
   

  
	
  Section 5.4.

  	
  Notice from the Liquidity Providers and
  Trustees

  	
   

  
	
  Section 5.5.

  	
  Agreements Relating to the Above-Cap
  Liquidity Facility

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI      THE
  SUBORDINATION AGENT

  	
   

  
	
  Section 6.1.

  	
  Authorization; Acceptance of Trusts and
  Duties

  	
   

  



 


i

















 


	
  Section 6.2.

  	
  Absence of Duties

  	
   

  
	
  Section 6.3.

  	
  No Representations or Warranties as to
  Documents

  	
   

  
	
  Section 6.4.

  	
  No Segregation of Monies; No Interest

  	
   

  
	
  Section 6.5.

  	
  Reliance; Agents; Advice of Counsel

  	
   

  
	
  Section 6.6.

  	
  Capacity in Which Acting

  	
   

  
	
  Section 6.7.

  	
  Compensation

  	
   

  
	
  Section 6.8.

  	
  May Become Certificateholder

  	
   

  
	
  Section 6.9.

  	
  Subordination Agent Required; Eligibility

  	
   

  
	
  Section 6.10.

  	
  Money to Be Held in Trust

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII      INDEMNIFICATION
  OF SUBORDINATION AGENT

  	
   

  
	
  Section 7.1.

  	
  Scope of Indemnification

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII      SUCCESSOR
  SUBORDINATION AGENT

  	
   

  
	
  Section 8.1.

  	
  Replacement of Subordination Agent;
  Appointment of Successor

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX      SUPPLEMENTS
  AND AMENDMENTS

  	
   

  
	
  Section 9.1.

  	
  Amendments, Waivers, Etc

  	
   

  
	
  Section 9.2.

  	
  Subordination Agent Protected

  	
   

  
	
  Section 9.3.

  	
  Effect of Supplemental Agreements

  	
   

  
	
  Section 9.4.

  	
  Notice and Information to Rating Agencies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X      MISCELLANEOUS

  	
   

  
	
  Section 10.1.

  	
  Termination of Intercreditor Agreement

  	
   

  
	
  Section 10.2.

  	
  Intercreditor Agreement for Benefit of
  Trustees, Liquidity Providers, the Policy Provider and Subordination Agent

  	
   

  
	
  Section 10.3.

  	
  Notices

  	
   

  
	
  Section 10.4.

  	
  Severability

  	
   

  
	
  Section 10.5.

  	
  No Oral Modifications or Continuing Waivers

  	
   

  
	
  Section 10.6.

  	
  Successors and Assigns

  	
   

  
	
  Section 10.7.

  	
  Headings

  	
   

  
	
  Section 10.8.

  	
  Counterpart Form

  	
   

  
	
  Section 10.9.

  	
  Subordination

  	
   

  
	
  Section 10.10.

  	
  Governing Law

  	
   

  
	
  Section 10.11.

  	
  Submission to Jurisdiction; Waiver of Jury
  Trial; Waiver of Immunity

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 2.02(b)

  	
  —

  	
   

  	
   

  
	
  Exhibit A

  	
  —

  	
  Trustee Reports

  	
   

  



 


ii

















 


INTERCREDITOR AGREEMENT


 


INTERCREDITOR
AGREEMENT dated as of March 24, 2004, among WILMINGTON TRUST COMPANY, a Delaware
banking corporation (“WTC”), not
in its individual capacity but solely as Trustee of each Trust (each as defined
below); LANDESBANK HESSEN-THÜRINGEN
GIROZENTRALE, a public-law banking institution organized under the
laws of Germany, as Class G-1 Primary Liquidity Provider, Class G-2
Primary Liquidity Provider and Class C Primary Liquidity Provider; MORGAN STANLEY CAPITAL SERVICES INC., a
corporation organized under the laws of the State of Delaware (“MSCS”), as Class G-1 Above-Cap Liquidity
Provider, Class G-2 Above-Cap Liquidity Provider and Class C Above-Cap
Liquidity Provider; MBIA INSURANCE
CORPORATION, a New York stock insurance company, as Policy Provider;
and WILMINGTON TRUST COMPANY, not
in its individual capacity except as expressly set forth herein, but solely as
Subordination Agent and trustee hereunder (in such capacity, together with any
successor appointed pursuant to Article VIII hereof, the “Subordination Agent”).


 


WHEREAS,
all capitalized terms used herein shall have the respective meanings referred
to in Article I hereof;


 


WHEREAS,
pursuant to each Indenture JetBlue will issue on a recourse basis three series
of Equipment Notes to finance or refinance the purchase of each Aircraft;


 


WHEREAS,
pursuant to the Financing Agreements, each Trust will acquire Equipment Notes
having an interest rate equal to the interest rate applicable to the
Certificates to be issued by such Trust;


 


WHEREAS,
pursuant to each Trust Agreement, the Trust created thereby proposes to issue a
single class of Certificates (a “Class”)
bearing the interest rate and having the final distribution date described in
such Trust Agreement on the terms and subject to the conditions set forth
therein;


 


WHEREAS,
pursuant to the Underwriting Agreement, the Underwriters propose to purchase
the Certificates issued by each Trust in the aggregate face amount set forth
opposite the name of such Trust on Schedule I thereto on the terms and
subject to the conditions set forth therein;


 


WHEREAS,
the Primary Liquidity Provider proposes to enter into three separate revolving
credit agreements and the Above-Cap Liquidity Provider proposes to enter into
three separate irrevocable interest rate cap agreements, in each case, with the
Subordination Agent, as agent for the Trustee of the Class G-1 Trust,
Class G-2 Trust and the Class C Trust, respectively, for the benefit
of the Certificateholders of each such Trust;


 


WHEREAS,
Morgan Stanley (the “Guarantor”)
will guarantee in full, pursuant to separate Guarantee Agreements dated as of
the date hereof (each, a “Guarantee
Agreement”), the obligations of
MSCS under each Above-Cap Liquidity Facility;


 

















 


WHEREAS,
the Policy Provider proposes to enter into the Policy Provider Agreement providing
for the issuance by the Policy Provider of two separate Policies for the
benefit of the Class G-1 Certificateholders and Class G-2
Certificateholders; and


 


WHEREAS,
it is a condition precedent to the obligations of the Underwriters under the
Underwriting Agreement that the Subordination Agent, the Trustees, the
Liquidity Providers and the Policy Provider agree to the terms of subordination
set forth in this Agreement in respect of each Class of Certificates, and the
Subordination Agent, the Trustees, the Liquidity Providers and the Policy
Provider, by entering into this Agreement, hereby acknowledge and agree to such
terms of subordination and the other provisions of this Agreement.


 


NOW,
THEREFORE, in consideration of the mutual agreements herein
contained, and of other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:


 


ARTICLE I


 


DEFINITIONS


 


Section 1.1.            Definitions.  For all purposes of this Agreement (and all
schedules or exhibits hereto), except as otherwise expressly provided or unless
the context otherwise requires:


 


(1)           the terms used herein that are
defined in this Article have the meanings assigned to them in this
Article, and include the plural as well as the singular;


 


(2)           all references in this Agreement to
designated “Articles”, “Sections” and other subdivisions are to the designated
Articles, Sections and other subdivisions of this Agreement;


 


(3)           the words “herein”, “hereof’ and
“hereunder” and other words of similar import refer to this Agreement as a
whole and not to any particular Article, Section or other subdivision; and


 


(4)           the term “including” shall mean
“including without limitation”.


 


“Above-Cap Account” means the Class G-1
Above-Cap Account, the Class G-2 Above-Cap Account or the Class C Above-Cap
Account, as applicable.


 


“Above-Cap Liquidity Facility” means the
Class G-1 Above-Cap Liquidity Facility, the Class G-2 Above-Cap Liquidity
Facility or the Class C Above-Cap Liquidity Facility, as applicable.


 


“Above-Cap Liquidity Provider” means the
Class G-1 Above-Cap Liquidity Provider, the Class G-2 Above-Cap Liquidity
Provider or the Class C Above-Cap Liquidity Provider, as applicable.


 


“Above-Cap Payment” has the meaning as
specified in Section 3.6(a).


 


2

















 


“Above-Cap Reserve Account” means the
Class G-1 Above-Cap Reserve Account, the Class G-2 Above-Cap Reserve
Account or the Class C Above-Cap Reserve Account, as applicable.


 


“Above-Cap Withdrawal” has the meaning
specified in Section 3.6(a).


 


“Acceleration” means, with respect to
the amounts payable in respect of the Equipment Notes issued under any
Indenture, such amounts becoming immediately due and payable by declaration or
otherwise.  “Accelerate”, “Accelerated”
and “Accelerating” have meanings correlative to the foregoing.


 


“Accrued Class G-1 Interest” means,
with respect to any Distribution Date, all amounts due and owing in respect of
accrued and unpaid interest on the Class G-1 Certificates at the Stated
Interest Rate for the Class G-1 Certificates on such Distribution Date.


 


“Accrued Class G-2 Interest” means,
with respect to any Distribution Date, all amounts due and owing in respect of
accrued and unpaid interest on the Class G-2 Certificates at the Stated
Interest Rate for the Class G-2 Certificates on such Distribution Date.


 


“Actual Disposition Event” means, in
respect of any Equipment Note, (i) the disposition of the Collateral (as
defined in the Indenture pursuant to which such Equipment Note was issued),
(ii) the occurrence of the mandatory redemption date for such Equipment
Note following an Event of Loss with respect to the Aircraft which secured such
Equipment Note or (iii) the sale of such Equipment Note.


 


“Additional Payment” means the payment
of any Break Amount (as such term is defined in the applicable Indentures)
and/or Prepayment Premium (as such term is defined in the applicable
Indentures) in respect of the Equipment Notes.


 


“Adjusted Interest” means, as of any
Current Distribution Date, (I) any interest described in clause (II) of
this definition accruing prior to the immediately preceding Distribution Date
which remains unpaid and (II) interest at the Stated Interest Rate for the
Class C Certificates (A) for the number of days during the period
commencing on, and including, the immediately preceding Distribution Date (or,
if the Current Distribution Date is the first Distribution Date, the Closing
Date) and ending on, but excluding the Current Distribution Date, on the
Preferred C Pool Balance on such Current Distribution Date and (B) on the
principal amount calculated pursuant to clauses (i), (ii), (iii) and (iv)
of the definition of Preferred C Pool Balance for each Series C Equipment Note
with respect to which a disposition, distribution, sale or Deemed Disposition
Event has occurred since the immediately preceding Distribution Date, for each
day during the period, for each such Equipment Note, commencing on, and
including, the immediately preceding Distribution Date (or, if the Current
Distribution Date is the first Distribution Date, the Closing Date) and ending
on, but excluding the date of disposition, distribution, sale or Deemed
Disposition Event with respect to such Equipment Note, Aircraft or Collateral,
as the case may be.


 


“Advance”, with respect to any Primary
Liquidity Facility, means any Advance as defined in such Primary Liquidity
Facility.


 


3

















 


“Affiliate” means, with respect to any
Person, any other Person directly or indirectly controlling, controlled by or
under common control with such Person. 
For the purposes of this definition, “control”, when used with respect
to any specified Person, means the power, directly or indirectly, to direct or
cause the direction of the management and policies of such Person whether
through the ownership of voting securities or by contract or otherwise; and the
terms “controlling” and “controlled” have meanings correlative to the
foregoing.


 


“Aircraft” means, with respect to each
Indenture, the “Aircraft” referred to therein.


 


“Appraisal” has the meaning assigned to
such term in Section 4.1(a)(ii).


 


“Appraised Current Market Value” of any
Aircraft means the lower of the average and the median of the three most recent
Post-Default Appraisals of such Aircraft.


 


“Appraisers” means Aircraft Information
Services, Inc., AvSolutions, Inc., Morten Beyer and Agnew, Inc., Aviation
Specialists Group, Inc. and Airclaims Group Limited or, so long as the Person
entitled or required hereunder to select such Appraisers acts reasonably, any
other nationally recognized appraiser reasonably acceptable to the
Subordination Agent and the Controlling Party.


 


“Assignment and Assumption Agreements”
means each of the Assignment and Assumption Agreements to be executed between a
Trustee and trustee of the relevant Successor Trust in accordance with the
relevant Trust Agreement, as the same may be amended, modified or supplemented
from time to time.


 


“Available Amount” means, with respect
to any Primary Liquidity Facility on any drawing date, the “Maximum Available
Commitment” as defined in such Primary Liquidity Facility.


 


“Bankruptcy Code” means the United
States Bankruptcy Code, 11 U.S.C. Section 101 et seq.


 


“Break
Amount”, with respect to
any Equipment Note, has the meaning assigned to such term in the Indenture
related to such Equipment Note.


 


“Business Day” means any day
(a) other than a Saturday or Sunday or a day (i) on which commercial
banks are required or authorized to close in Darien, Connecticut, New York, New
York, or, so long as any Certificate is outstanding, the city and state in the
United States in which any Trustee, the Subordination Agent or any Loan Trustee
maintains its Corporate Trust Office or receives and disburses funds and
(ii) for purposes of each Policy and the Policy Provider, on which the
fiscal agent under the Policy, at its office specified in such Policy, the
Policy Provider at its office specified in the Policy and insurance companies
in New York, New York are required or authorized by law or executive order to
close and (b) solely with respect to draws under any Primary Liquidity
Facility, which is also a “Business Day” as defined in such Primary Liquidity
Facility.


 


4

















 


“Capped Interest Rate” means
(i) with respect to the Class G-1 Certificates, 8.375% per annum,
(ii) with respect to the Class G-2 Certificates, 8.420% per annum,
and (iii) with respect to the Class C Certificates, 12.250% per
annum.


 


“Capped Three-Month LIBOR” means, at any
time, 8% per annum.


 


“Cash Collateral Account” means the
Class G-1 Primary Cash Collateral Account, the Class G-2 Primary Cash
Collateral Account, the Class C Primary Cash Collateral Account, the
Class G-1 Above-Cap Reserve Account, the Class G-2 Above-Cap Reserve
Account or the Class C Above-Cap Reserve Account, as applicable.


 


“Certificate” means a Class G-1
Certificate, a Class G-2 Certificate or a Class C Certificate, as
applicable.


 


“Certificateholder” means any holder of
one or more Certificates.


 


“Class” has the meaning assigned to such
term in the preliminary statements to this Agreement.


 


“Class C Above-Cap Account” means an
Eligible Deposit Account in the name of the Subordination Agent maintained at
an Eligible Institution, which shall be the Subordination Agent if it shall so
qualify, into which all amounts paid under the Class C Above-Cap Liquidity
Facility pursuant to Section 3.6(a) shall be deposited.


 


“Class C Above-Cap Liquidity Facility”
means, initially, the ISDA Master Agreement, dated as of the date hereof,
between the Subordination Agent, as agent and trustee for the Class C Trust,
and the initial Class C Above-Cap Liquidity Provider, together with the
Schedule and Confirmation attached thereto, relating to the Class C
Certificates, and, from and after replacement of such ISDA Master Agreement
pursuant hereto, the Replacement Above-Cap Liquidity Facility therefor, if any,
in each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.


 


“Class C Above-Cap Liquidity Provider”
means MSCS or any Replacement Above-Cap Liquidity Provider which has issued a
Replacement Above-Cap Liquidity Facility to replace the Class C Above-Cap
Liquidity Facility pursuant to Section 3.6(c)(ii).


 


“Class C Above-Cap Reserve Account”
means an Eligible Deposit Account in the name of the Subordination Agent
maintained at an Eligible Institution, which shall be the Subordination Agent
if it shall so qualify, into which all amounts paid under the Class C Above-Cap
Liquidity Facility pursuant to Section 3.6(f) shall be deposited.


 


“Class C Certificateholder” means,
at any time, any holder of one or more Class C Certificates.


 


“Class C Certificates” means the
certificates issued by the Class C Trust, substantially in the form of
Exhibit A to the Class C Trust Agreement, and authenticated by the
Class C Trustee, representing fractional undivided interests in the
Class C Trust, and any certificates issued in exchange therefor or
replacement thereof pursuant to the terms of the Class C Trust Agreement.


 


5

















 


“Class C Deposits” means the
Deposits with respect to the Class C Certificates.


 


“Class C Paying Agent Account”
means the Paying Agent Account as defined in the Escrow and Paying Agent
Agreement relating to the Class C Certificates.


 


“Class C Primary Cash Collateral Account”
means an Eligible Deposit Account in the name of the Subordination Agent
maintained at an Eligible Institution, which shall be the Subordination Agent
if it shall so qualify, into which all amounts drawn under the Class C
Primary Liquidity Facility pursuant to Section 3.6(c), 3.6(d), 3.6(i) or
3.6(k) shall be deposited.


 


“Class C Primary Liquidity Facility”
means, initially, the Revolving Credit Agreement dated as of the date hereof,
between the Subordination Agent, as agent and trustee for the Class C
Trustee, and the initial Class C Primary Liquidity Provider, and, from and
after the replacement of such Agreement pursuant hereto, the Replacement Primary
Liquidity Facility therefor, if any, in each case as amended, supplemented or
otherwise modified from time to time in accordance with its terms.


 


“Class C Primary Liquidity Provider”
means Landesbank Hessen-Thüringen Girozentrale together with any Replacement Primary
Liquidity Provider which has issued a Replacement Primary Liquidity Facility to
replace any Class C Primary Liquidity Facility pursuant to
Section 3.6(e).


 


“Class C Trust” means
(i) prior to the Transfer, the JetBlue Airways Pass Through Trust 2004-1C-O
created and administered pursuant to the Class C Trust Agreement and
(ii) after the Transfer, the JetBlue Airways Pass Through Trust 2004-1C-S
created and administered pursuant to the Class C Trust Agreement.


 


“Class C Trust Agreement” means
(i) prior to the Transfer, the Pass Through Trust Agreement, dated as of
the date hereof, between JetBlue and the Class C Trustee, governing the
creation and administration of the JetBlue Airways Pass Through Trust 2004-1C-O
and the issuance of the Class C Certificates, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms, and (ii) after the Transfer, the Pass Through Trust Agreement
entered into between JetBlue and the Class C Trustee, governing the
creation and administration of the JetBlue Airways Pass Through Trust 2004-1C-S
and the issuance of the Class C Certificates, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with its
terms.


 


“Class C Trustee” means WTC, not in
its individual capacity except as expressly set forth in the Class C Trust
Agreement, but solely as trustee under the Class C Trust Agreement,
together with any successor trustee appointed pursuant thereto.


 


“Class G-1 Above-Cap Account” means an Eligible
Deposit Account in the name of the Subordination Agent maintained at an
Eligible Institution, which shall be the Subordination Agent if it shall so
qualify, into which all amounts paid under the Class G-1 Above-Cap Liquidity
Facility pursuant to Section 3.6(a) shall be deposited.


 


“Class G-1 Above-Cap Liquidity Facility”
means, initially, the ISDA Master Agreement, dated as of the date hereof,
between the Subordination Agent, as agent and trustee


 


6

















 


for the Class G-1 Trust, and the initial Class G-1 Above-Cap Liquidity
Provider, together with the Schedule and Confirmation attached thereto,
relating to the Class G-1 Certificates, and, from and after replacement of such
ISDA Master Agreement pursuant hereto, the Replacement Above-Cap Liquidity
Facility therefor, if any, in each case as amended, supplemented or otherwise
modified from time to time in accordance with its terms.


 


“Class G-1 Above-Cap Liquidity Provider”
means MSCS or any Replacement Above-Cap Liquidity Provider which has issued a
Replacement Above-Cap Liquidity Facility to replace the Class G-1 Above-Cap
Liquidity Facility pursuant to Section 3.6(c)(ii).


 


“Class G-1 Above-Cap Reserve Account”
means an Eligible Deposit Account in the name of the Subordination Agent
maintained at an Eligible Institution, which shall be the Subordination Agent
if it shall so qualify, into which all amounts paid under the Class G-1
Above-Cap Liquidity Facility pursuant to Section 3.6(f) shall be
deposited.


 


“Class G-1 Certificateholder”
means, at any time, any holder of one or more Class G-1 Certificates.


 


“Class G-1 Certificates” means the
certificates issued by the Class G-1 Trust, substantially in the form of
Exhibit A to the Class G-1 Trust Agreement, and authenticated by the
Class G-1 Trustee, representing fractional undivided interests in the
Class G-1 Trust, and any certificates issued in exchange therefor or
replacement thereof pursuant to the terms of the Class G-1 Trust
Agreement.


 


“Class G-1 Deposits” means the
Deposits with respect to the Class G-1 Certificates.


 


“Class G-1 Paying Agent Account”
means the Paying Agent Account as defined in the Escrow and Paying Agent
Agreement relating to the Class G-1 Certificates.


 


“Class G-1 Policy” means the MBIA
Insurance Corporation Financial Guaranty Insurance Policy No. 43567(1),
together with the endorsements thereto, issued as of the Closing Date in favor
of the Subordination Agent for the benefit of the Class G-1
Certificateholders, as amended, supplemented or otherwise modified from time to
time in accordance with its terms.


 


“Class G-1 Policy Account” means
the Eligible Deposit Account established by the Subordination Agent pursuant to
Section 2.2(a)(iii)(x) into which amounts will be deposited pursuant to
Section 3.7.


 


“Class G-1 Primary Cash Collateral Account”
means an Eligible Deposit Account in the name of the Subordination Agent
maintained at an Eligible Institution, which shall be the Subordination Agent
if it shall so qualify, into which all amounts drawn under the Class G-1
Primary Liquidity Facility pursuant to Section 3.6(c), 3.6(d), 3.6(i) or
3.6(k) shall be deposited.


 


“Class G-1 Primary Liquidity Facility”
means, initially, the Revolving Credit Agreement dated as of the date hereof,
between the Subordination Agent, as agent and trustee for the Class G-1
Trustee, and the initial Class G-1 Primary Liquidity Provider, and, from
and after the replacement of such Agreement pursuant hereto, the Replacement
Primary Liquidity Facility


 


7

















 


therefor, if any, in each case as amended, supplemented or otherwise
modified from time to time in accordance with its terms.


 


“Class G-1 Primary Liquidity Provider”
means Landesbank Hessen-Thüringen Girozentrale, together with any Replacement
Primary Liquidity Provider which has issued a Replacement Primary Liquidity
Facility to replace any Class G-1 Primary Liquidity Facility pursuant to
Section 3.6(e).


 


“Class G-1 Trust” means
(i) prior to the Transfer, the JetBlue Airways Pass Through Trust
2004-1G-1-O created and administered pursuant to the Class G-1 Trust
Agreement and (ii) after the Transfer, the JetBlue Airways Pass Through
Trust 2004-1G-1-S created and administered pursuant to the Class G-1 Trust
Agreement.


 


“Class G-1 Trust Agreement” means
(i) prior to the Transfer, the Pass Through Trust Agreement, dated as of
the date hereof, between JetBlue and the Class G-1 Trustee, governing the
creation and administration of the JetBlue Airways Pass Through Trust
2004-1G-1-O and the issuance of the Class G-1 Certificates, as the same
may be amended, supplemented or otherwise modified from time to time in
accordance with its terms, and (ii) after the Transfer, the Pass Through
Trust Agreement entered into between JetBlue and the Class G-1 Trustee,
governing the creation and administration of the JetBlue Airways Pass Through
Trust 2004-1G-1-S and the issuance of the Class G-1 Certificates, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.


 


“Class G-1 Trustee” means WTC, not
in its individual capacity except as expressly set forth in the Class G-1
Trust Agreement, but solely as trustee under the Class G-1 Trust
Agreement, together with any successor trustee appointed pursuant thereto.


 


“Class G-2 Above-Cap Account” means an
Eligible Deposit Account in the name of the Subordination Agent maintained at
an Eligible Institution, which shall be the Subordination Agent if it shall so
qualify, into which all amounts paid under the Class G-2 Above-Cap Liquidity
Facility pursuant to Section 3.6(a) shall be deposited.


 


“Class G-2 Above-Cap Liquidity Facility”
means, initially, the ISDA Master Agreement, dated as of the date hereof,
between the Subordination Agent, as agent and trustee for the Class G-2 Trust,
and the initial Class G-2 Above-Cap Liquidity Provider, together with the
Schedule and Confirmation attached thereto, relating to the Class G-2
Certificates, and, from and after replacement of such ISDA Master Agreement
pursuant hereto, the Replacement Above-Cap Liquidity Facility therefor, if any,
in each case as amended, supplemented or otherwise modified from time to time
in accordance with its terms.


 


“Class G-2 Above-Cap Liquidity Provider”
means MSCS or any Replacement Above-Cap Liquidity Provider which has issued a
Replacement Above-Cap Liquidity Facility to replace the Class G-2 Above-Cap
Liquidity Facility pursuant to Section 3.6(c)(ii).


 


“Class G-2 Above-Cap Reserve Account”
means an Eligible Deposit Account in the name of the Subordination Agent
maintained at an Eligible Institution, which shall be the Subordination Agent
if it shall so qualify, into which all amounts paid under the Class G-2
Above-Cap Liquidity Facility pursuant to Section 3.6(f) shall be
deposited.


 


8

















 


“Class G-2 Certificateholder”
means, at any time, any holder of one or more Class G-2 Certificates.


 


“Class G-2 Certificates” means the
certificates issued by the Class G-2 Trust, substantially in the form of Exhibit A
to the Class G-2 Trust Agreement, and authenticated by the Class G-2
Trustee, representing fractional undivided interests in the Class G-2
Trust, and any certificates issued in exchange therefor or replacement thereof
pursuant to the terms of the Class G-2 Trust Agreement.


 


“Class G-2 Deposits” means the
Deposits with respect to the Class G-2 Certificates.


 


“Class G-2 Paying Agent Account”
means the Paying Agent Account as defined in the Escrow and Paying Agent
Agreement relating to the Class G-2 Certificates.


 


“Class G-2 Policy” means the MBIA
Insurance Corporation Financial Guaranty Insurance Policy No. 43567(2),
together with the endorsements thereto, issued as of the Closing Date in favor
of the Subordination Agent for the benefit of the Class G-2
Certificateholders, as amended, supplemented or otherwise modified from time to
time in accordance with its terms.


 


“Class G-2 Policy Account” means
the Eligible Deposit Account established by the Subordination Agent pursuant to
Section 2.2(a)(iii)(y) into which amounts will be deposited pursuant to
Section 3.7.


 


“Class G-2 Primary Cash Collateral Account”
means an Eligible Deposit Account in the name of the Subordination Agent
maintained at an Eligible Institution, which shall be the Subordination Agent
if it shall so qualify, into which all amounts drawn under the Class G-2
Primary Liquidity Facility pursuant to Section 3.6(c), 3.6(d), 3.6(i) or
3.6(k) shall be deposited.


 


“Class G-2 Primary Liquidity Facility”
means, initially, the Revolving Credit Agreement dated as of the date hereof,
between the Subordination Agent, as agent and trustee for the Class G-2
Trustee, and the initial Class G-2 Primary Liquidity Provider, and, from
and after the replacement of such Agreement pursuant hereto, the Replacement
Primary Liquidity Facility therefor, if any, in each case as amended,
supplemented or otherwise modified from time to time in accordance with its
terms.


 


“Class G-2 Primary Liquidity Provider”
means Landesbank Hessen-Thüringen Girozentrale, together with any Replacement
Primary Liquidity Provider which has issued a Replacement Primary Liquidity
Facility to replace any Class G-2 Primary Liquidity Facility pursuant to
Section 3.6(e).


 


“Class G-2 Trust” means
(i) prior to the Transfer, the JetBlue Airways Pass Through Trust
2004-1G-2-O created and administered pursuant to the Class G-2 Trust
Agreement and (ii) after the Transfer, the JetBlue Airways Pass Through
Trust 2004-1G-2-S created and administered pursuant to the Class G Trust
Agreement.


 


“Class G-2 Trust Agreement” means
(i) prior to the Transfer, the Pass Through Trust Agreement, dated as of
the date hereof, between JetBlue and the Class G-2 Trustee, governing the
creation and administration of the JetBlue Airways Pass Through Trust
2004-1G-2-O and the


 


9

















 


issuance of the Class G-2 Certificates, as the same may be
amended, supplemented or otherwise modified from time to time in accordance
with its terms, and (ii) after the Transfer, the Pass Through Trust
Agreement entered into between JetBlue and the Class G-2 Trustee,
governing the creation and administration of the JetBlue Airways Pass Through
Trust 2004-1G-2-S and the issuance of the Class G-2 Certificates, as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with its terms.


 


“Class G-2 Trustee” means WTC, not
in its individual capacity except as expressly set forth in the Class G-2
Trust Agreement, but solely as trustee under the Class G-2 Trust
Agreement, together with any successor trustee appointed pursuant thereto.


 


“Closing Date” means March 24,
2004.


 


“Code” means the Internal Revenue Code
of 1986, as amended from time to time, and the Treasury Regulations promulgated
thereunder.


 


“Collateral” has the meaning assigned to
such term in the Indentures.


 


“Collection Account” means the Eligible
Deposit Account established by the Subordination Agent pursuant to
Section 2.2 which the Subordination Agent shall make deposits in and
withdrawals from in accordance with this Agreement.


 


“Consent Period” has the meaning
assigned to such term in Section 3.6(d).


 


“Controlling Party” means the Person
entitled to act as such pursuant to the terms of Section 2.6.


 


“Corporate Trust Office” means, with
respect to any Trustee, the Subordination Agent or any Loan Trustee, the office
of such Person in the city at which, at any particular time, its corporate
trust business shall be principally administered.


 


“Current Distribution Date” means a
Distribution Date specified as a reference date for calculating the Expected
Distributions with respect to the Certificates of any Trust as of such
Distribution Date.


 


“Deemed Disposition Event” means, in
respect of any Equipment Note, the continuation of an Indenture Event of
Default in respect of such Equipment Note without an Actual Disposition Event
occurring in respect of such Equipment Note for a period of five years from the
date of the occurrence of such Indenture Event of Default.


 


“Deficiency Amount” has the meaning
assigned to such term in Section 3.6(a).


 


“Delivery Period Expiry Date” means the
earlier of (a) March 31, 2005, or, if the Equipment Notes relating to
all the Aircraft (or Substitute Aircraft in lieu thereof) have not been
purchased by the Trusts on or prior to such date due to any reason beyond the
control of JetBlue and not occasioned by JetBlue’s fault or negligence,
June 30, 2005 and (b) the date on which Equipment Notes with respect
to all Aircraft (or Substitute Aircraft in lieu thereof) have been purchased by
the Trusts in accordance with the Note Purchase Agreement.


 


10

















 


“Deposit Agreement” shall mean, with
respect to any Class, the Deposit Agreement pertaining to such Class dated as
of the date hereof between the Escrow Agent and the Depositary, as the same may
be amended, modified or supplemented from time to time in accordance with the
terms thereof.


 


“Depositary” means HSH Nordbank AG, New
York Branch, a New York State licensed branch office of a Landesbank organized
under the laws of Germany, as depositary under each Deposit Agreement, or its
successors and assigns.


 


“Deposits” with respect to any Class,
shall have the meaning set forth in the Deposit Agreement pertaining to such
Class.


 


“Designated Representatives” means the
Subordination Agent Representatives, the Trustee Representatives and the
Provider Representatives identified under Section 2.5.


 


“Disposition” has the meaning assigned
to such term in Section 3.7(c).


 


“Disposition Payment” has the meaning
assigned to such term in Section 3.7(b).


 


“Distribution Date” means a Regular
Distribution Date or a Special Distribution Date.


 


“Dollars” or “$” means United States dollars.


 


“Downgrade Drawing” has the meaning
assigned to such term in Section 3.6(c).


 


“Downgrade Event” has the meaning
assigned to such term in each Liquidity Facility.


 


“Downgraded Facility” has the meaning
assigned to such term in Section 3.6(c).


 


“Drawing” means an Interest Drawing, a
Final Drawing, a Non-Extension Drawing, a Special Termination Drawing or a
Downgrade Drawing, as the case may be.


 


“Election Distribution Date” has the
meaning assigned to such term in Section 3.7(c).


 


“Election Interest Payment” has the
meaning ascribed to such term in Section 3.7(c).


 


“Eligible Deposit Account” means either
(a) a segregated account with an Eligible Institution or (b) a
segregated trust account with the corporate trust department of a depository
institution organized under the laws of the United States of America or any one
of the states thereof or the District of Columbia (or any U.S. branch of a
foreign bank), having corporate trust powers and acting as trustee for funds
deposited in such account, so long as any of the securities of such depository
institution has a long-term unsecured debt rating from each Rating Agency of at
least A-3 or its equivalent.  An
Eligible Deposit Account may be maintained with a Primary Liquidity Provider so
long as such Primary Liquidity Provider is an Eligible Institution; provided
that such Primary Liquidity Provider shall have waived all rights of set-off
and counterclaim with respect to such account.


 


11

















 


“Eligible Institution” means
(a) the corporate trust department of the Subordination Agent or any
Trustee, as applicable, or (b) a depository institution organized under
the laws of the United States of America or any one of the states thereof or
the District of Columbia (or any U.S. branch of a foreign bank), which has a
long-term unsecured debt rating from each Rating Agency of at least A-3 or its
equivalent.


 


“Eligible Investments” means
(a) investments in obligations of, or guaranteed by, the United States
Government having maturities no later than 90 days following the date of such
investment, (b) investments in open market commercial paper of any
corporation incorporated under the laws of the United States of America or any
state thereof with a short-term unsecured debt rating issued by Moody’s and
short-term issuer credit rating by Standard & Poor’s of at least P-1
and A-1, respectively, having maturities no later than 90 days following the
date of such investment or (c) investments in negotiable certificates of
deposit, time deposits, banker’s acceptances, commercial paper or other direct
obligations of, or obligations guaranteed by, commercial banks organized under
the laws of the United States or of any political subdivision thereof (or any
U.S. branch of a foreign bank) with short-term unsecured debt ratings and
short-term issuer credit ratings of at least P-1 by Moody’s and A-1 by
Standard & Poor’s, having maturities no later than 90 days following
the date of such investment; provided, however, that (x) all Eligible
Investments that are bank obligations shall be denominated in U.S. dollars; and
(y) the aggregate amount of Eligible Investments at any one time that are
bank obligations issued by any one bank shall not be in excess of 5% of such
bank’s capital surplus; provided further that (1) any investment of the
types described in clauses (a), (b) and (c) above may be made through a
repurchase agreement in commercially reasonable form with a bank or other
financial institution qualifying as an Eligible Institution so long as such
investment is held by a third party custodian also qualifying as an Eligible Institution,
and (2) all such investments set forth in clause (a), (b) or (c) above
mature (i) with respect to investments of Scheduled Payments, no later
than the Business Day immediately preceding the next Regular Distribution Date
and (ii) with respect to investments of Special Payments, no later than
the Business Day immediately preceding the Special Distribution Date for such
Special Payments; provided further, however, that in the case of any Eligible
Investment issued by a domestic branch of a foreign bank, the income from such
investment shall be from sources within the United States for purposes of the
Code.  Notwithstanding the foregoing, no
investment of the types described in clause (b) above which is issued or
guaranteed by JetBlue or any of its Affiliates, and no investment in the
obligations of any one bank in excess of $10,000,000, shall be an Eligible
Investment unless written approval has been obtained from the Policy Provider
and a Ratings Confirmation shall have been received with respect to the making
of such investment.


 


“Equipment Notes” means, at any time,
the Series G-1 Equipment Notes, Series G-2 Equipment Notes and the Series C
Equipment Notes, collectively, and in each case, any Equipment Notes issued in
exchange therefor or replacement thereof pursuant to the terms of the
Indentures.


 


“Escrow Agent” means WTC, as escrow
agent under each Escrow and Paying Agent Agreement, together with its
successors in such capacity.


 


“Escrow and Paying Agent Agreement”
shall mean, with respect to any Class, the Escrow and Paying Agent Agreement
pertaining to such Class dated as of the date hereof


 


12

















 


between the Escrow Agent, the Underwriters, the Trustee for such Class
and the Paying Agent, as the same may be amended, modified or supplemented from
time to time in accordance with the terms thereof.


 


“Escrow Receipts” has the meaning
assigned to such term in the Escrow and Paying Agent Agreement for the Trusts.


 


“Excess Interest Policy Drawing” has the
meaning assigned to such term in Section 3.7(c).


 


“Excess Reimbursement Obligations”
means, (a) in the event of any Policy Provider Election, the portion of
the Policy Provider Obligations that represents interest on the Series G-1
Equipment Notes or Series G-2 Equipment Notes in respect of which the Policy
Provider Election has been made in excess of 21 months of interest at the
interest rate applicable to such Equipment Note, (b) any interest on the
Liquidity Obligations in respect of the Class G-1 Primary Liquidity
Facility and, Glass G-2 Primary Liquidity Facility paid by the Policy Provider
to the Primary Liquidity Provider from and after the end of the 21-month period
referred to in Section 3.7(c) hereof and (c) interest on Policy
Drawings as set forth in the Policy Provider Agreement (other than any such
interest that constitutes a Policy Provider Obligation).


 


“Expected Distributions” means, with
respect to the Certificates of any Trust on any Current Distribution Date, the
difference between (A) the Pool Balance of such Certificates as of the
immediately preceding Distribution Date (or, if the Current Distribution Date
is the first Distribution Date, the original aggregate face amount of the
Certificates of such Trust), and (B) the Pool Balance of such Certificates
as of the Current Distribution Date calculated on the basis that (i) the
principal of the Non-Performing Equipment Notes held in such Trust has been
paid in full and such payments have been distributed to the holders of such
Certificates, (ii) the principal of the Performing Equipment Notes held in
such Trust have been paid when due (without giving effect to any Acceleration
of Performing Equipment Notes) and such payments have been distributed to the
holders of such Certificates and (iii) the principal of any Equipment
Notes formerly held in such Trust that have been sold pursuant to the terms
hereof has been paid in full and such payments have been distributed to the
holders of such Certificates, but without giving effect to any reduction in the
Pool Balance as a result of any distribution attributable to Deposits occurring
after the immediately preceding Distribution Date (or, if the Current
Distribution Date is the first Distribution Date, occurring after the initial
issuance of the Certificates of such Trust). 
For purposes of calculating Expected Distributions with respect to the
Certificates of any Trust, any Additional Payment paid on the Equipment Notes
held in such Trust which has not been distributed to the Certificateholders of
such Trust (other than such Additional Payment or a portion thereof applied to
the payment of interest on the Certificates of such Trust or the reduction of
the Pool Balance of such Trust) shall be added to the amount of such Expected
Distributions.


 


“Expiry Date” with respect to any
Primary Liquidity Facility, shall have the meaning set forth in such Primary
Liquidity Facility.


 


“Fee Letter” means the Fee Letter dated
as of the date hereof among JetBlue, Landesbank Hessen-Thüringen Girozentrale
and the Subordination Agent with respect to the


 


13

















 


initial Primary Liquidity Facilities and any fee letter entered into
among JetBlue, the Subordination Agent and any Replacement Primary Liquidity
Provider.


 


“Final Distributions” means, with
respect to the Certificates of any Trust on any Distribution Date, the sum of
(x) the aggregate amount of all accrued and unpaid interest on such
Certificates (excluding interest, if any, payable with respect to the Deposits
relating to such Trust) and (y) the Pool Balance of such Certificates as
of the immediately preceding Distribution Date (less the amount of the Deposits
for such Class of Certificates as of such preceding Distribution Date other
than any portion of such Deposits thereafter used to acquire Equipment Notes
pursuant to the Note Purchase Agreement). 
For purposes of calculating Final Distributions with respect to the
Certificates of any Trust, any Additional Payment paid on the Equipment Notes
held in such Trust which has not been distributed to the Certificateholders of
such Trust (other than such Additional Payment or a portion thereof applied to
the payment of interest on the Certificates of such Trust or the reduction of
the Pool Balance of such Trust) shall be added to the amount of such Final
Distributions.


 


“Final Drawing” has the meaning assigned
to such term in Section 3.6(i).


 


“Final Legal Distribution Date” means
(i) with respect to the Class G-1 Certificates, June 15, 2015,
(ii) with respect to the Class G-2 Certificates, September 15, 2015
and (iii) with respect to the Class C Certificates, September 15,
2009.


 


“Financing Agreement” means each of the
Participation Agreements and the Note Purchase Agreement.


 


“Guarantee
Agreement” has the meaning assigned to such term in the
Recitals.


 


“Guarantor” has the meaning assigned to
such term in the Recitals.


 


“Indenture” means each of the Trust
Indentures entered into by the Loan Trustee and JetBlue pursuant to the Note
Purchase Agreement, in each case as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms.


 


“Indenture Default” means, with respect
to any Indenture, any Default (as such term is defined in such Indenture)
thereunder.


 


“Indenture Event of Default” means, with
respect to any Indenture, any Event of Default (as such term is defined in such
Indenture) thereunder.


 


“Individual Drawn Percentage” means, as
of any date, with respect to an Interest Drawing under a Primary Liquidity
Facility or a withdrawal from a Primary Cash Collateral Account pursuant to
Section 3.6(f)(i)(A), (ii)(A) or (iii)(A), a fraction (x) the
numerator of which is the outstanding amount of such Interest Drawing or such
withdrawal as of such date and (y) the denominator of which is the applicable
Required Amount as of the date of such Interest Drawing or withdrawal,
calculated in accordance with clause (i) of the definition of “Required Amount”
as of the date of such Interest Drawing or such withdrawal and on the basis of
the lower of the applicable Stated Interest Rate and the applicable Capped
Interest Rate as of the date of such Interest Drawing or such withdrawal, as
the case may be.   Repayments of
Interest


 


14

















 


Drawings or such withdrawals shall be deemed to have been made in the
order in which such Interest Drawings or withdrawals were made.


 


“Interest Drawing” has the meaning
assigned to such term in Section 3.6(a).


 


“Interest Payment Date” means, with
respect to any Primary Liquidity Facility, the final day of each Interest
Period (as defined in such Primary Liquidity Facility) thereunder.


 


“Interest Period” with respect to any
Indenture, has the meaning assigned to such term in such Indenture.


 


“Investment Earnings” means investment
earnings on funds on deposit in the Trust Accounts net of losses and investment
expenses of the Subordination Agent in making such investments.


 


“ISTAT” means the International Society
of Transport Aircraft Trading.


 


“JetBlue” means JetBlue Airways
Corporation, a Delaware corporation, and its successors and assigns.


 


“JetBlue Bankruptcy Event” means the
occurrence and continuation of any of the following:


 


(a)           JetBlue shall consent to the
appointment of or the taking of possession by a receiver, trustee or liquidator
of itself or of substantially all of its property, or shall make a general
assignment for the benefit of creditors, or JetBlue shall file a voluntary
petition in bankruptcy or a voluntary petition or an answer seeking
reorganization, liquidation or other relief in a case under any bankruptcy laws
or other insolvency laws (as in effect at such time) or an answer admitting the
material allegations of a petition filed against JetBlue in any such case, or
JetBlue shall seek relief by voluntary petition, answer or consent, under the
provisions of any other bankruptcy or other similar law providing for the
reorganization or winding-up of corporations (as in effect at such time) or
JetBlue shall seek an agreement, composition, extension or adjustment with its
creditors under such laws, or JetBlue’s board of directors shall adopt a
resolution authorizing corporate action in furtherance of any of the foregoing;
or


 


(b)           an order, judgment or decree shall be
entered by any court of competent jurisdiction appointing, without the consent
of JetBlue, a receiver, trustee or liquidator of JetBlue or of substantially
all of its property, or substantially all of the property of JetBlue shall be
sequestered, or granting any other relief in respect of JetBlue as a debtor under
any bankruptcy laws or other insolvency laws (as in effect at such time), and
any such order, judgment or decree of appointment or sequestration shall remain
in force undismissed, unstayed and unvacated for a period of 90 days after the
date of entry thereof; or


 


(c)           a petition against JetBlue in a case
under any bankruptcy laws or other insolvency laws (as in effect at such time)
is filed and not withdrawn or dismissed within 90 days thereafter, or if, under
the provisions of any law providing for reorganization or winding-up of
corporations which may apply to JetBlue, any court of competent jurisdiction
assumes jurisdiction, custody or control of JetBlue or of any substantial part
of its property and such


 


15

















 


jurisdiction, custody or control remains in force
unrelinquished, unstayed and unterminated for a period of 90 days.


 


“JetBlue Provisions” has the meaning
specified in Section 9.1(a).


 


“Last Payment Date” has the meaning
assigned to such term in Section 3.7(c).


 


“Lending Office” means, with respect to
any Primary Liquidity Facility, the office of the Primary Liquidity Provider
thereunder, presently located at Frankfurt, Germany or such other office as
such Liquidity Provider from time to time shall notify the applicable Trustee
as its “Lending Office” under any such Primary Liquidity Facility; provided
that such Primary Liquidity Provider shall not change its Lending Office to
another Lending Office outside the United States of America except in accordance
with Section 3.01, 3.02 or 3.03 of any such Primary Liquidity Facility.


 


“LIBOR Business Day” means any day on
which dealings are carried on in the London interbank market.


 


“Lien” means any mortgage, pledge, lien,
charge, claim, disposition of title, encumbrance, lease, sublease, sub-sublease
or security interest of any kind, including, without limitation, any thereof
arising under any conditional sales or other title retention agreement.


 


“Liquidity Event of Default” with
respect to any Primary Liquidity Facility, has the meaning assigned to such
term in such Primary Liquidity Facility.


 


“Liquidity Expenses” means, with respect
to the Primary Liquidity Facilities, all Liquidity Obligations other than
(i) the amount of any Drawings under the Primary Liquidity Facilities and
(ii) any interest accrued on any Liquidity Obligations.


 


“Liquidity Facility” means, at any time,
a Primary Liquidity Facility or an Above-Cap Liquidity Facility, as applicable.


 


“Liquidity Obligations” means all
principal, interest, fees and other amounts owing to the Primary Liquidity
Providers under the Primary Liquidity Facilities, Section 9.1 of the
Participation Agreements or the Fee Letter.


 


“Liquidity Provider” means, at any time,
any Primary Liquidity Provider or any Above-Cap Liquidity Provider, as
applicable.


 


“Loan Trustee” means, with respect to
any Indenture, the mortgagee thereunder.


 


“Minimum Sale Price” means, with respect
to any Aircraft or the Equipment Notes issued in respect of such Aircraft, at
any time, the lesser of (a) in the case of such Aircraft, 75%, or in the
case of such Equipment Notes, 80% of the Appraised Current Market Value of such
Aircraft and (b) the aggregate outstanding principal amount of such
Equipment Notes, plus accrued and unpaid interest thereon.


 


“Moody’s” means Moody’s Investors
Service, Inc.


 


16

















 


“Non-Controlling Party” means, at any
time, any of the Trustees, the Liquidity Providers or the Policy Provider which
is not the Controlling Party at such time.


 


“Non-Extended Facility” has the meaning
assigned to such term in Section 3.6(d).


 


“Non-Extension Drawing” has the meaning
assigned to such term in Section 3.6(d).


 


“Non-Performing Equipment Note” means an
Equipment Note issued pursuant to an Indenture that is not a Performing
Equipment Note.


 


“Note Holder” with respect to an
Indenture, has the meaning assigned to such term in such Indenture.


 


“Note Purchase Agreement” means the Note
Purchase Agreement dated as of the date hereof, among JetBlue, each Trustee,
the Escrow Agent, the Subordination Agent and the Paying Agent.


 


“Notice for Payment” means a Notice of
Nonpayment as such term is defined in the Policy.


 


“Notice of Avoided Payment” has the
meaning assigned to such term in the Policy.


 


“Officer’s Certificate” of any Person
means a certification signed by a Responsible Officer of such Person.


 


“Operative Agreements” means this
Agreement, the Liquidity Facilities, the Policies, the Policy Provider
Agreement, the Indentures, the Trust Agreements, the Underwriting Agreement,
the Financing Agreements, the Fee Letter, the Policy Fee Letter, the Equipment
Notes and the Certificates, together with all exhibits and schedules included
with any of the foregoing.


 


“Order” has the meaning assigned to such
term in the Policy.


 


“Outstanding” means, when used with
respect to each Class of Certificates, as of the date of determination, all
Certificates of such Class theretofore authenticated and delivered under the
related Trust Agreement, except:


 


(i)            Certificates
of such Class theretofore canceled by the Registrar (as defined in such Trust
Agreement) or delivered to the Trustee thereunder or such Registrar for
cancellation;


 


(ii)           Certificates
of such Class for which money in the full amount required to make the Final
Distribution with respect to such Certificates pursuant to Section 11.01
of such Trust Agreement has been theretofore deposited with the related Trustee
in trust for the holders of such Certificates as provided in Section 4.01
of such Trust Agreement pending distribution of such money to such
Certificateholders pursuant to such Final Distribution payment; and


 


17

















 


(iii)          Certificates
of such Class in exchange for or in lieu of which other Certificates have been
authenticated and delivered pursuant to such Trust Agreement;


 


provided, however, that in determining whether the holders of the
requisite Outstanding amount of such Certificates have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, any
Certificates owned by JetBlue or any of its Affiliates shall be disregarded and
deemed not to be Outstanding, except that, in determining whether such Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Certificates that such Trustee knows
to be so owned shall be so disregarded. 
Certificates so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
applicable Trustee the pledgee’s right so to act with respect to such
Certificates and that the pledgee is not JetBlue or any of its Affiliates.


 


“Overdue Scheduled Payment” means any
Scheduled Payment which is not in fact received by the Subordination Agent
within ten Business Days after the Scheduled Payment Date relating thereto.


 


“Participation Agreement” means, with
respect to each Indenture, the “Participation Agreement” referred to therein.


 


“Payee” has the meaning assigned to such
term in Section 2.4(e).


 


“Paying Agent” means WTC, as paying
agent under each Escrow and Paying Agent Agreement, together with its
successors in such capacity.


 


“Performing Equipment Note” means an
Equipment Note with respect to which no payment default has occurred and is
continuing (without giving effect to any Acceleration); provided that in the
event of a bankruptcy proceeding under the Bankruptcy Code under which JetBlue
is a debtor, (i) any payment default existing during the 60-day period
under Section 1110(a)(2)(A) of the Bankruptcy Code (or such longer period
as may apply under Section 1110(b) of the Bankruptcy Code) (the “Section 1110 Period”) shall not be
taken into consideration until the expiration of the applicable period,
(ii) any payment default occurring after the date of the order of relief
in such proceeding but during the Section 1110 Period will not be taken
into consideration if such payment default is cured under
Section 1110(a)(2)(B) of the Bankruptcy Code before the later of 30 days
after the date of such default or the expiration of the Section 1110
Period and (iii) any payment default occurring after the Section 1110
Period will not be taken into consideration if such payment default is cured
before the end of the grace period, if any, set forth in the related Indenture.


 


“Performing Note Deficiency” means any
time that less than 65% of the then aggregate outstanding principal amount of
all Equipment Notes are Performing Equipment Notes.


 


“Permitted Liens” has the meaning assigned
to such term in the Indentures.


 


“Person” means any individual,
corporation, partnership, joint venture, association, limited liability
company, joint-stock company, trust, trustee, unincorporated organization or
government or any agency or political subdivision thereof.


 


18

















 


“Policy” means the Class G-1 Policy
or the Class G-2 Policy, as applicable, and “Policies” shall mean both such policies.


 


“Policy Account” means the
Class G-1 Policy Account or the Class G-2 Policy Account, as the case
may be.


 


“Policy Drawing” means, with respect to
a Policy, any payment of a claim under such Policy.


 


“Policy Expenses” means all amounts
(including amounts in respect of expenses or indemnities) due to the Policy
Provider under the Policy Provider Agreement or the Financing Agreements other
than (i) any amounts due under the Policy Fee Letter, (ii) the amount
of any Excess Reimbursement Obligations, (iii) any Policy Drawing and
interest accrued thereon, (iv) any interest accrued on any Policy Provider
Obligations, (v) reimbursement of and interest on the Liquidity
Obligations in respect of the Primary Liquidity Facilities paid by the Policy
Provider to any Primary Liquidity Provider, (vi) any indemnity payments
owed to the Policy Provider and (vii) any amounts that the Policy Provider
is entitled to receive by virtue of the subrogation rights of the Policy
Provider hereunder, including, without limitation, fees and expenses incurred
in connection with the enforcement of such rights.


 


“Policy Fee Letter” means the fee
letter, dated March 24, 2004 from the Policy Provider to JetBlue and the
Subordination Agent.


 


“Policy Provider” means
MBIA Insurance Corporation.


 


“Policy Provider Agreement” means the
Insurance and Indemnity Agreement dated as of the date hereof among the
Subordination Agent, as agent and trustee for the Class G-1 Trustee and
Class G-2 Trustee, JetBlue and the Policy Provider as amended,
supplemented or otherwise modified from time to time in accordance with its
terms.


 


“Policy Provider Default” shall mean the
occurrence of any of the following events (a) the Policy Provider fails to
make a payment required under either Policy in accordance with its terms and
such failure remains unremedied for 2 Business Days following the delivery of
Written Notice of such failure to the Policy Provider or (b) the Policy
Provider (i) files any petition or commences any case or proceeding under
any provisions of any federal or state law relating to insolvency, bankruptcy,
rehabilitation, liquidation or reorganization, (ii) makes a general
assignment for the benefit of its creditors or (iii) has an order for
relief entered against it under any federal or state law relating to
insolvency, bankruptcy, rehabilitation, liquidation or reorganization that is
final and nonappealable, or (c) a court of competent jurisdiction, the
New York Insurance Department or another competent regulatory authority
enters a final and nonappealable order, judgment or decree (i) appointing
a custodian, trustee, agent or receiver for the Policy Provider or for all or
any material portion of its property or (ii) authorizing the taking of
possession by a custodian, trustee, agent or receiver of the Policy Provider
(or taking of possession of all or any material portion of the Policy
Provider’s property).


 


“Policy Provider Documents”  means each Policy, the Policy Provider
Agreement and the Policy Fee Letter.


 


19

















 


“Policy Provider Election” has the
meaning assigned to such term in Section 3.7(c).


 


“Policy Provider Interest Obligations”
means any interest on any Policy Drawing made to cover any shortfall
attributable to any failure of the relevant Primary Liquidity Provider to honor
any Interest Drawing in accordance with Section 2.02(a) of the applicable
Primary Liquidity Facility in an amount equal to the amount of interest that
would have accrued on such Interest Drawing if such Interest Drawing had been
made in accordance with Section 2.02(a) of such Primary Liquidity
Facility, at the interest rate applicable to such Interest Drawing until such
Policy Drawing has been repaid in full up to a maximum of six such Policy
Drawings.


 


“Policy Provider Obligations” means all
reimbursement and other amounts, including, without limitation, fees and
indemnities (to the extent not included in Policy Expenses), due to the Policy
Provider under the Policy Provider Agreement but shall not include (i) any
amounts under the Policy Fee Letter and (ii) any interest on Policy
Drawings except Policy Provider Interest Obligations.


 


“Policy Provider Rating” shall mean the
respective ratings by each of the Ratings Agencies of the Policy Provider’s
financial strength in respect of the Policy.


 


“Policy Provider Threshold Rating” shall
mean a Policy Provider Rating of Aaa by Moody’s and AAA by Standard &
Poor’s.


 


“Pool Balance” means, with respect to
each Trust or the Certificates issued by any Trust, as of any date,
(i) the original aggregate face amount of the Certificates of such Trust
less (ii) the aggregate amount of all payments made in respect of the
Certificates of such Trust or in respect of Deposits relating to such Trust
other than payments made in respect of interest or Additional Payment thereon
or reimbursement of any costs and expenses in connection therewith.  The Pool Balance for each Trust or for the
Certificates issued by any Trust as of any Distribution Date shall be computed
after giving effect to any special distribution with respect to unused
Deposits, payment of principal of the Equipment Notes, payments under the
related Policy (other than in respect of interest on the Certificates) or
payment with respect to other Collateral held in such Trust and the
distribution thereof to be made on that date.


 


“Post-Default Appraisal” has the meaning
assigned to such term in Section 4.1(a).


 


“Preferred C Pool Balance” means, as of
any date, the excess of (A) the Pool Balance of the Class C Certificates
as of the immediately preceding Distribution Date (or, if such date is on or
before the first Distribution Date, the original aggregate face amount of the
Class C Certificates) (after giving effect to distributions made on such date)
over (B) (i) the outstanding principal amount of each Series C
Equipment Note which remains unpaid as of such date subsequent to the
disposition of the Collateral (as defined in the Indenture pursuant to which
such Series C Equipment Note was issued), (ii) the outstanding principal
amount of each Series C Equipment Note which remains unpaid as of such date subsequent
to the scheduled date of mandatory redemption of such Series C Equipment Note
following an Event of Loss with respect to the Aircraft which secured such
Series C Equipment Note, (iii) the difference between (x) the
outstanding amount of principal and interest as of the date of sale of each
Series C Equipment Note previously sold and (y) the purchase price
received with respect to the sale of such Series C


 


20

















 


Equipment Note and (iv) the amount of principal outstanding on any
Series C Equipment Note with respect to which a Deemed Disposition Event has
occurred.


 


“Preference Amount” has the meaning
assigned to such term in the Policy.


 


“Prepayment Premium” has the meaning set
forth in the Indenture.


 


“Primary Cash Collateral Account” means
the Class G-1 Primary Cash Collateral Account, the Class G-2 Primary Cash
Collateral Account or the Class C Primary Cash Collateral Account, as
applicable.


 


“Primary Liquidity Facility” means, at
any time, the Class G-1 Primary Liquidity Facility, the Class G-2 Primary
Liquidity Facility or the Class C Primary Liquidity Facility, as applicable.


 


“Primary Liquidity Provider” means, at
any time, the Class G-1 Primary Liquidity Provider, the Class G-2 Primary
Liquidity Provider or the Class C Primary Liquidity Provider, as applicable.


 


“Prior Funds” means, with respect to any
Distribution Date, (i) with respect to the Class G-1 Certificates,
any amounts received by the Escrow Agent in the Class G-1 Paying Agent
Account in respect of accrued interest on the Class G-1 Deposits, any
Drawing paid under the Class G-1 Primary Liquidity Facility in respect of
interest due on the Class G-1 Certificates on such Distribution Date and
any withdrawal of funds from the Class G-1 Primary Cash Collateral Account
and the Class G-1 Above-Cap Account in respect of such interest and
(ii) with respect to the Class G-2 Certificates, any amounts received
by the Escrow Agent in the Class G-2 Paying Agent Account in respect of
accrued interest on the Class G-2 Deposits, any Drawing paid under the
Class G-2 Primary Liquidity Facility in respect of interest due on the
Class G-2 Certificates on such Distribution Date and any withdrawal of
funds from the Class G-2 Primary Cash Collateral Account and the
Class G-2 Above-Cap Account in respect of such interest.


 


“Proceeding” means any suit in equity,
action at law or other judicial or administrative proceeding.


 


“Provider Incumbency Certificate” has
the meaning assigned to such term in Section 2.5(c).


 


“Provider Representatives” has the
meaning assigned to such term in Section 2.5(c).


 


“PTC Event of Default” means, with
respect to each Trust Agreement, the failure to pay within 10 Business Days
after the applicable Distribution Date: 
(i) the outstanding Pool Balance of the applicable Class of
Certificates on the Final Legal Distribution Date for such Class (unless, in
the case of the Class G-1 Certificates or Class G-2 Certificates, the
Subordination Agent shall have made a drawing under the related Policy in an
aggregate amount sufficient to pay such outstanding Pool Balance and shall have
distributed such amount to the Class G-1 Trustee and/or Class G-2
Trustee, as the case may be) or (ii) interest due on such Certificates on
any Distribution Date (unless the Subordination Agent shall have made an
Interest Drawing, or a


 


21

















 


withdrawal from the related Cash Collateral Account or the related
Above-Cap Account, or in the case of the Class G-1 Trust or Class G-2
Trust, a drawing under the related Policy, with respect thereto in an aggregate
amount sufficient to pay such interest and shall have distributed such amount
to the Trustee entitled thereto).


 


“Rating Agencies” means, collectively,
at any time, each nationally recognized rating agency which shall have been
requested to rate the Certificates and which shall then be rating the
Certificates.  The initial Rating
Agencies will be Moody’s and Standard & Poor’s.


 


“Ratings Confirmation” means, with
respect to any action proposed to be taken, a written confirmation from each of
the Rating Agencies that such action would not result in (i) a reduction
of the rating for any Class of Certificates below the then current rating for
such Class of Certificates such ratings as determined (without regard to the
Policies in respect of the Class G-1 Certificates and Class G-2
Certificates) or (ii) a withdrawal or suspension of the rating of any
Class of Certificates.


 


“Regular Distribution Dates” means each
March 15, June 15, September 15 and December 15, commencing
on June 15, 2004; provided, however, that, if any such day shall not be a
Business Day, the related distribution shall be made on the next succeeding
Business Day.


 


“Replacement Above-Cap Liquidity Facility”
means an irrevocable interest rate cap agreement (or agreements) for the same
term as the Above-Cap Liquidity Facility being replaced, in substantially the
same form of the Above-Cap Liquidity Facility being replaced or in such other
form (which may include a letter of credit) as shall permit the Rating Agencies
to issue in writing, and the Rating Agencies shall have issued in writing, a
Ratings Confirmation (before the downgrading of the ratings on the
Certificates, if any, as a result of any downgrading of the Above-Cap Liquidity
Provider and without regard to the Policies), issued by a Person (or Person(s))
having short-term unsecured debt ratings or short-term issuer credit ratings,
as the case may be, issued by Moody’s and S&P that are equal to or higher than
the applicable Threshold Rating (which Person, in the case of the Class G-1
Above-Cap Liquidity Facility and the Class G-2 Above-Cap Liquidity Facility
will be consented to by the Policy Provider, which consent shall not be
unreasonably withheld or delayed).


 


“Replacement Above-Cap Liquidity Provider”
means a Person (or Persons) who issue a Replacement Above-Cap Liquidity
Facility.


 


“Replacement Primary Liquidity Facility”
means, for any Primary Liquidity Facility, an irrevocable revolving credit
agreement (or agreements) in substantially the form of the replaced Primary
Liquidity Facility, including reinstatement provisions, or in such other form
(which may include a letter of credit) as shall permit the Rating Agencies to
confirm in writing their respective ratings then in effect for the related
Certificates (before downgrading of such ratings, if any, as a result of the
downgrading of the applicable Primary Liquidity Provider and without regard to
the Policies) and, in the case of the Class G-1 Liquidity Facility and
Class G-2 Liquidity Facility only, consented to by the Policy Provider,
which consent shall not be unreasonably withheld or delayed, in a face amount
(or in an aggregate face amount) equal to the Required Amount and issued by a
Person (or Persons) having short-term unsecured debt ratings or short-term
issuer credit ratings, as the case may be, issued by both Rating Agencies which
are


 


22

















 


equal to or higher than the Threshold Rating.  Without limitation of the form that a Replacement Primary
Liquidity Facility otherwise may have pursuant to the preceding sentence, a
Replacement Primary Liquidity Facility for any Class of Certificates may have a
stated expiration date earlier than 15 days after the Final Legal Distribution
Date of such Class of Certificates so long as such Replacement Primary
Liquidity Facility provides for a Non-Extension Drawing as contemplated by
Section 3.6(d) hereof.


 


“Replacement Primary Liquidity Provider”
means a Person (or Persons) who issues a Replacement Primary Liquidity
Facility.


 


“Required Amount” means, with respect to
each Primary Liquidity Facility, or the Primary Cash Collateral Account, for
any Class, for any day, (i) so long as there is no Interest Drawing made
thereunder remaining unreimbursed on such day, the aggregate amount of
interest, calculated at the rate per annum equal to the applicable Capped
Interest Rate for the related Class of Certificates, that would be payable on
such Class of Certificates on each of the six successive Regular Distribution
Dates immediately following such day, without regard to expected future
distributions of principal on such Class of Certificates or (ii) if one or
more Interest Drawings made thereunder remain unreimbursed on such day, the sum
of (x) the unreimbursed amount of such Interest Drawing(s) and
(y) product of (A) the Undrawn Percentage and (B) the amount
determined pursuant to clause (i) as if no Interest Drawings were outstanding
and unreimbursed on such date.  The
“Undrawn Percentage” as of any date is equal to one hundred percent minus the
sum of the Individual Drawn Percentages for the Interest Drawings that are
unreimbursed as of such date.  The Pool
Balance for purposes of the definition of Required Amount with respect to the
Class G-1 Primary Liquidity Facility and Class G-2 Primary Liquidity
Facility shall, in the event of any Policy Provider Election, be deemed to be
reduced by the amount (if positive) by which (a) the then outstanding
principal balance of each Series G-1 Equipment Note and Series G-2 Equipment
Note in respect of which such Policy Provider Election has been made shall
exceed (b) the amount of any Policy Drawings previously paid by the Policy
Provider in respect of principal on such Series G-1 Equipment Note and Series
G-2 Equipment Note.  The Pool Balance
for purposes of the definition of Required Amount with respect to the Class C
Primary Liquidity Facility shall be the Preferred C Pool Balance as of the
applicable date of determination.


 


“Reserve Account” means the Eligible
Deposit Account established by the Subordination Agent pursuant to
Section 2.2 from which the Subordination Agent shall make withdrawals to
fund the Post-Default Appraisals in accordance with Section 4.1 hereof.


 


“Reserve Amount” means $75,000.


 


“Responsible Officer” means
(i) with respect to the Subordination Agent and each of the Trustees, any
officer in the corporate trust administration department of the Subordination
Agent or such Trustee with direct responsibility for the administration of the
transactions contemplated hereby, and also means with respect to a particular
corporate trust matter any officer of the Subordination Agent or such Trustee
(as applicable) to whom any corporate trust matter is referred because of his knowledge
of and familiarity with a particular subject, (ii) with respect to each
Liquidity Provider, any authorized officer of such Liquidity Provider, and
(iii) with respect to the Policy Provider, any authorized officer of the
Policy Provider.


 


23

















 


“Scheduled Payment” means, with respect
to any Equipment Note, (i) any payment of principal or interest on such
Equipment Note (other than an Overdue Scheduled Payment) due from the obligor
thereon or (ii) any payment of interest on the corresponding Class of
Certificates with funds drawn under the Primary Liquidity Facility for such
Class or withdrawn from the Primary Cash Collateral Account or the Above-Cap
Account for such Class (or, in the case of any Series G-1 Equipment Note or
Series G-2 Equipment Note, drawn under the related Policy), which payment
represents the installment of principal at the stated maturity of such
installment of principal on such Equipment Note, the payment of regularly
scheduled interest accrued on the unpaid principal amount of such Equipment
Note, or both; provided that any payment of principal of, Additional Payment,
if any, or interest resulting from the redemption or purchase of any Equipment
Note shall not constitute a Scheduled Payment.


 


“Scheduled Payment Date” means, with
respect to any Scheduled Payment, the date on which such Scheduled Payment is
scheduled to be made.


 


“Section 2.4(a) Fraction” has the
meaning assigned to such term in Section 2.4(a).


 


“Series C Equipment Notes” means the
Series C Equipment Notes issued pursuant to any Indenture by JetBlue and
authenticated by the Loan Trustee thereunder, and any such Equipment Notes
issued in exchange therefor or replacement thereof pursuant to the terms of
such Indenture.


 


“Series G-1 Equipment Notes” means the
Series G-1 Equipment Notes issued pursuant to any Indenture by JetBlue and
authenticated by the Loan Trustee thereunder, and any such Equipment Notes
issued in exchange therefor or replacement thereof pursuant to the terms of
such Indenture.


 


“Series G-2 Equipment Notes” means the
Series G-2 Equipment Notes issued pursuant to any Indenture by JetBlue and
authenticated by the Loan Trustee thereunder, and any such Equipment Notes
issued in exchange therefor or replacement thereof pursuant to the terms of
such Indenture.


 


“Special Distribution Date” means with
respect to any Special Payment: 
(i) the date chosen by the Subordination Agent pursuant to
Section 2.4(a) for the distribution of such Special Payment in accordance
with this Agreement, whether distributed pursuant to Section 2.4 or
Section 3.2 hereof, (ii) an Election Distribution Date or
(iii) the date chosen by the Subordination Agent pursuant to
Section 3.7(b), 3.7(c) or Section 3.7(e), as the case may be, for the
distribution of such Special Payment in accordance with the provisions thereof
or otherwise designated as a Special Distribution Date.


 


“Special Payment” means any payment
(other than a Scheduled Payment) in respect of, or any proceeds of, any
Equipment Note or Collateral.


 


“Special Payments Account” means the
Eligible Deposit Account created pursuant to Section 2.2 as a sub-account
to the Collection Account.


 


“Special Termination Drawing” has the
meaning assigned to such term in Section 3.6(k).


 


24

















 


“Special Termination Notice” with
respect to any Primary Liquidity Facility has the meaning assigned to such term
in such Primary Liquidity Facility.


 


“Standard & Poor’s” means
Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc.


 


“Stated Amount” with respect to any
Primary Liquidity Facility, means the Maximum Commitment (as defined in such
Primary Liquidity Facility).


 


“Stated Expiration Date” has the meaning
specified in Section 3.6(d).


 


“Stated Interest Rate” means for each
interest period (i) with respect to the Class G-1 Certificates,
Three-Month LIBOR plus 0.375% per annum, (ii) with respect to the Class
G-2 Certificates, Three-Month LIBOR plus 0.420% per annum and (iii) with
respect to the Class C Certificates, Three-Month LIBOR plus 4.250% per annum;
provided, that if a payment default on any Equipment Note exists on any Regular
Distribution Date, from such Regular Distribution Date and for each full
interest period while such default is continuing, the Stated Interest Rate for
each Class of Certificates shall not exceed the applicable Capped Interest Rate
for such Class.


 


“Subordination Agent” has the meaning
assigned to it in the preliminary statements to this Agreement.


 


“Subordination Agent Incumbency Certificate”
has the meaning assigned to such term in Section 2.5(a).


 


“Subordination Agent Representatives”
has the meaning assigned to such term in Section 2.5(a).


 


“Substitute Aircraft” shall have the
meaning set forth in the Note Purchase Agreement.


 


“Successor Trusts” means, collectively,
JetBlue Airways Pass Through Trust 2004-1G-1-S, JetBlue Airways Pass Through
Trust 2004-1G-2-S and JetBlue Airways Pass Through Trust 2004-1C-S.


 


“Tax” and “Taxes” mean any and all taxes, levies, duties, tariffs,
imposts and other charges of a similar kind (together with any and all
interest, penalties, loss, damage, liability, expense, additions to tax and
additional amounts or costs incurred or imposed with respect thereto) imposed
or otherwise assessed by the United States of America or by any state, local or
foreign government (or any subdivision or agency thereof) or other taxing
authority, including, without limitation: 
taxes on or with respect to income, franchises, windfall or other profits,
gross receipts, property, sales, use, capital stock, payroll, employment,
social security, workers’ compensation, unemployment compensation, or net
worth; taxes in the nature of excise, withholding, ad valorem, stamp, transfer,
non-recoverable value added, taxes on goods and services and gains taxes.


 


“Tax Letter” means that certain Tax
Letter dated as of the date hereof among JetBlue, Landesbank Hessen-Thüringen
Girozentrale and the Subordination Agent with respect to the initial Primary
Liquidity Facilities.


 


25

















 


“Termination Amount”, with respect to an
Above-Cap Liquidity Facility, has the meaning assigned to such term in such
Above-Cap Liquidity Facility.


 


“Termination Notice” with respect to any
Primary Liquidity Facility has the meaning assigned to such term in such
Primary Liquidity Facility.


 


“Three-Month LIBOR”
has the meaning assigned to such term in the applicable Indentures.


 


“Threshold Rating” means the short-term
unsecured debt rating of P-1 by Moody’s and short-term issuer credit rating of
A-1 by Standard & Poor’s for each Liquidity Provider.


 


“Transfer” means, with respect to any
particular Trust, the transfers contemplated by the Assignment and Assumption
Agreement with respect to such Trust.


 


“Treasury Regulations” means
regulations, including proposed or temporary regulations, promulgated under the
Code.  References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.


 


“Triggering Event” means (x) the
occurrence of an Indenture Event of Default under all of the Indentures
resulting in a PTC Event of Default with respect to the most senior Class of
Certificates then Outstanding, (y) the Acceleration of all of the
outstanding Equipment Notes (provided that, with respect to the period prior to
the Delivery Period Expiry Date, the aggregate principal balance of such
Equipment Notes is in excess of $300 million) or (z) the occurrence of a
JetBlue Bankruptcy Event.


 


“Trust” means any of the Class G-1
Trust, the Class G-2 Trust or the Class C Trust.


 


“Trust Accounts” has the meaning
assigned to such term in Section 2.2(a).


 


“Trust Agreement” means any of the
Class G-1 Trust Agreement, the Class G-2 Trust Agreement or the
Class C Trust Agreement.


 


“Trustee” means any of the
Class G-1 Trustee, the Class G-2 Trustee or the Class C Trustee.


 


“Trustee Incumbency Certificate” has the
meaning assigned to such term in Section 2.5(b).


 


“Trustee Representatives” has the
meaning assigned to such term in Section 2.5(b).


 


“Underwriters” means the several
underwriters listed as such in the Underwriting Agreement.


 


“Underwriting Agreement” means the
Underwriting Agreement dated March 18, 2004 among the Underwriters and
JetBlue, relating to the purchase of the Certificates by the


 


26

















 


Underwriters, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with its terms.


 


“Unindemnified Tax” means (i) any
Tax imposed on the net income, net worth or capital, any franchise Tax or
similar doing business Tax of the Subordination Agent, and (ii) any
withholding Tax imposed by the United States (including, without limitation,
any withholding Tax imposed by the United States which is imposed or increased
as a result of the Subordination Agent’s failing to deliver to the Company any
certificate or document necessary to establish that payments under this
Agreement are exempt from withholding Tax).


 


“Written Notice” means, from the
Subordination Agent, any Trustee, any Liquidity Provider or the Policy
Provider, a written instrument executed by the Designated Representative of
such Person.  An invoice delivered by a
Liquidity Provider pursuant to Section 3.1 in accordance with its normal
invoicing procedures shall constitute Written Notice under such Section.


 


“WTC” has the meaning assigned to such
term in the recital of parties to this Agreement.


 


ARTICLE II


 


TRUST
ACCOUNTS; CONTROLLING PARTY


 


Section
2.1.            Agreement
to Terms of Subordination; Payments from Monies Received Only.  (a) Each Trustee hereby
(i) acknowledges and agrees to the terms of subordination and distribution
set forth in this Agreement in respect of each Class of Certificates,
(ii) agrees to enforce such provisions and cause all payments in respect
of the Equipment Notes and the Liquidity Facilities and the Policies to be
applied in accordance with the terms of this Agreement and (iii) with
respect to payment in respect of the Equipment Notes received by it, agrees to
allocate such payments first, to interest payable in respect of the
Certificates issued by it, second, to amounts distributable in respect of the
Pool Balance of such Certificates, and third, to Additional Payments, if any,
payable in respect of such Certificates. 
In addition, each Trustee hereby agrees to cause the Equipment Notes
purchased by the related Trust to be registered in the name of the
Subordination Agent or its nominee, as agent and trustee for such Trustee, to
be held in trust by the Subordination Agent solely for the purpose of
facilitating the enforcement of the subordination and other provisions of this
Agreement.


 


(b)           Except as otherwise expressly
provided in the next succeeding sentence of this Section 2.1, all payments
to be made by the Subordination Agent hereunder shall be made only from amounts
received by it that constitute Scheduled Payments, Special Payments or other
payments under the Operative Agreements, including payments under
Section 9.1 of the Participation Agreements and payments under
Sections 6 and 7 of the Note Purchase Agreement, and only to the extent
that the Subordination Agent shall have received sufficient income or proceeds
therefrom to enable it to make such payments in accordance with the terms
hereof.  Each of the Trustees and the
Subordination Agent hereby agrees and, as provided in each Trust Agreement,
each Certificateholder, by its acceptance of a Certificate, each Primary
Liquidity Provider, by entering into the Primary Liquidity Facility to which it
is a party, and the Policy Provider, by entering into the Policy Provider
Agreement, have agreed to look solely to such


 


27

















 


amounts to the extent available for distribution to
them as provided in this Agreement and to the relevant Deposits and that none
of the Trustees, Loan Trustees, the Subordination Agent or WTC is personally
liable to any of them for any amounts payable or any liability under this
Agreement, any Trust Agreement, any Primary Liquidity Facility, the Policy
Provider Agreement or such Certificate, except (in the case of the
Subordination Agent) as expressly provided herein or (in the case of the
Trustees) as expressly provided in each Trust Agreement or (in the case of the
Loan Trustees) as expressly provided in any Operative Agreement.


 


Section 2.2.            Trust Accounts.  (a) Upon the execution of this
Agreement, the Subordination Agent shall establish and maintain in its name
(i) the Collection Account as an Eligible Deposit Account, bearing a
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Trustees, the Certificateholders, the Primary
Liquidity Providers and the Policy Provider, (ii) as a sub-account in the
Collection Account, the Special Payments Account as an Eligible Deposit
Account, bearing a designation clearly indicating that the funds deposited
therein are held in trust for the benefit of the Trustees, the
Certificateholders, the Primary Liquidity Providers and the Policy Provider,
(iii) (x) a Class G-1 Policy Account as an Eligible Deposit
Account bearing a designation clearly indicating that the funds deposited
therein are held in trust for the benefit of the Class G-1
Certificateholders and (y) a Class G-2 Policy Account as an Eligible
Deposit Account bearing a designation clearly indicating that the funds
deposited therein are held in trust for the benefit of the Class G-2
Certificateholders, (iv) the Reserve Account as an Eligible Deposit
Account, bearing a designation clearly indicating that the funds deposited
therein are held in trust for the benefit of the Trustees and the
Certificateholders, (v) a Class G-1 Above-Cap Account, a Class G-2
Above-Cap Account and a Class C Above-Cap Account, each bearing a designation
clearly indicating that the funds deposited therein are held in trust for the
benefit of the related Trustee and Certificateholders.  The Subordination Agent shall establish and
maintain the Cash Collateral Accounts pursuant to and under the circumstances
set forth in Section 3.6(f) hereof. 
Upon such establishment and maintenance under Section 3.6(f)
hereof, the Cash Collateral Accounts shall, together with the Collection Account,
the Policy Accounts and the Above-Cap Accounts, constitute the “Trust Accounts” hereunder.  Without limiting the foregoing, all monies
credited to the Trust Accounts shall be, and shall remain, the property of the
relevant Trust(s).


 


(b)           Funds on deposit in the Trust
Accounts shall be invested and reinvested by the Subordination Agent in
Eligible Investments selected by the Subordination Agent if such investments
are reasonably available and have maturities no later than the earlier of
(i) 90 days following the date of such investment and (ii) the Business
Day immediately preceding the Regular Distribution Date or the date of the
related distribution pursuant to Section 2.4 hereof, as the case may be,
next following the date of such investment (provided that the Subordination
Agent shall invest and reinvest funds on deposit in the Above-Cap Accounts and
the Above-Cap Reserve Accounts in the manner specified in Schedule 2.2(b)
attached hereto, subject to the foregoing limitation on maturity of such
investment); provided, further, that following the making of (i) a
Downgrade Drawing or a Special Termination Drawing under any Primary Liquidity
Facility, the Subordination Agent shall invest and reinvest such amounts in
Eligible Investments at the direction of JetBlue or (ii) a Non-Extension
Drawing under any Primary Liquidity Facility, the Subordination Agent shall
invest and reinvest such amounts in Eligible Investments pursuant to the
written instructions of the Primary Liquidity Provider funding such
Non-Extension Drawing; provided further, however, that notwithstanding the
foregoing, upon


 


28

















 


the occurrence and during the continuation of a
Triggering Event, the Subordination Agent shall invest and reinvest such
amounts in Eligible Investments in accordance with the written instructions of
the Controlling Party.  Unless otherwise
expressly provided in this Agreement (including, without limitation, with
respect to Investment Earnings on amounts on deposit in the Primary Cash
Collateral Accounts, Above-Cap Reserve Accounts and in the Above-Cap Accounts,
in each case, pursuant to Section 3.6(f) hereof), any Investment Earnings
shall be deposited in the Collection Account when received by the Subordination
Agent and shall be applied by the Subordination Agent in the same manner as the
other amounts on deposit in the Collection Account are to be applied and any
losses shall be charged against the principal amount invested, in each case net
of the Subordination Agent’s reasonable fees and expenses in making such investments.  The Subordination Agent shall not be liable
for any loss resulting from any investment, reinvestment or liquidation
required to be made under this Agreement other than by reason of its willful
misconduct or gross negligence or, with respect to the handling or transfer of
funds, its own negligence.  Eligible
Investments and any other investment required to be made hereunder shall be
held to their maturities except that any such investment may be sold (without
regard to its maturity) by the Subordination Agent without instructions
whenever such sale is necessary to make a distribution required under this
Agreement.  Uninvested funds held
hereunder shall not earn or accrue interest.


 


(c)           The Subordination Agent shall possess
all right, title and interest in all funds on deposit from time to time in the
Trust Accounts and in all proceeds thereof (including all income thereon,
except as otherwise expressly provided herein with respect to Investment
Earnings).  The Trust Accounts shall be
held in trust by the Subordination Agent under the sole dominion and control of
the Subordination Agent for the benefit of the Trustees, the
Certificateholders, the Liquidity Providers and the Policy Provider, as the
case may be.  If, at any time, any of
the Trust Accounts or the Reserve Account ceases to be an Eligible Deposit
Account, the Subordination Agent shall within 10 Business Days (or such longer
period, not to exceed 30 calendar days, to which the Policy Provider and each
Rating Agency may consent) establish a new Collection Account, Special Payments
Account, Policy Account, Reserve Account, Cash Collateral Account or Above-Cap
Account, as the case may be, as an Eligible Deposit Account and shall transfer
any cash and/or any investments to such new Collection Account, Special
Payments Account, Policy Account, Reserve Account, Cash Collateral Account, or
Above-Cap Account as the case may be. 
So long as WTC is an Eligible Institution, the Trust Accounts and
Reserve Account shall be maintained with it as Eligible Deposit Accounts.


 


(d)           The Subordination Agent shall possess
all right, title and interest in all funds on deposit from time to time in the
Reserve Account.  The Reserve Account
shall be used by the Subordination Agent solely to fund the Post-Default Appraisals
when required to be obtained pursuant to Section 4.1 hereof.


 


Section
2.3.            Deposits
to the Collection Account and Special Payments Account.  (a) The Subordination Agent shall, upon
receipt thereof, deposit in the Collection Account all Scheduled Payments
received by it (other than any Scheduled Payment which by the express terms
hereof is to be deposited to the Policy Account or a Cash Collateral Account).


 


29

















 


(b)           The Subordination Agent shall, on
each date when one or more Special Payments are made to the Subordination Agent
as holder of the Equipment Notes, deposit in the Special Payments Account the
aggregate amount of such Special Payments.


 


Section
2.4.            Distributions
of Special Payments.  (a) Notice
of Special Payment.  Except as
provided in Section 2.4(c) or 2.7, upon receipt by the Subordination
Agent, as registered holder of the Equipment Notes, of any notice of a Special
Payment (or, in the absence of any such notice, upon receipt by the Subordination
Agent of a Special Payment), the Subordination Agent shall promptly give notice
thereof to each Trustee, the Primary Liquidity Providers and the Policy
Provider.  The Subordination Agent shall
promptly calculate the amount of the redemption or purchase of Equipment Notes,
the amount of any Overdue Scheduled Payment or the proceeds of Equipment Notes
or the Collateral, as the case may be, comprising such Special Payment under
the applicable Indenture or Indentures and shall promptly send to each Trustee,
the Primary Liquidity Providers and the Policy Provider a Written Notice of
such amount and the amount allocable to each Trust.  Such Written Notice shall also set the distribution date for such
Special Payment, which shall be the Business Day which immediately follows the
later to occur of (x) the 15th day after the date of such Written Notice
or (y) the date the Subordination Agent has received or expects to receive
such Special Payment.  Amounts on deposit
in the Special Payments Account shall be distributed in accordance with
Article III hereof; provided, that if the Special Payment to be
distributed on any Special Distribution Date results from the redemption,
purchase or prepayment of any Equipment Note prior to the occurrence of a
payment default under any Indenture, the amount of accrued and unpaid Liquidity
Expenses and Policy Expenses which are not yet due that are payable pursuant to
clause “second” of Section 3.2 and any unpaid amounts which are not yet
due that are payable to the Policy Provider under the Policy Fee Letter
pursuant to clause “eleventh” of Section 3.2, shall be multiplied by a
fraction, the numerator of which shall be the aggregate outstanding principal
amount of Equipment Notes being redeemed, purchased or prepaid on such Special
Distribution Date, and the denominator of which shall be the aggregate
outstanding principal amount of all Equipment Notes (the “Section 2.4(a) Fraction”).


 


(b)           Investment of Amounts in Special
Payments Account.  Any amounts on
deposit in the Special Payments Account prior to the distribution thereof
pursuant to Article III hereof shall be invested in accordance with
Section 2.2(b).  Investment
Earnings on such investments shall be distributed in accordance with
Article III hereof.


 


(c)           Certain Payments.  Except for amounts constituting Liquidity
Obligations, Policy Expenses and Policy Provider Obligations, which shall be
distributed on a Distribution Date as provided in Section 2.4(a) or 3.2
hereof, the Subordination Agent will distribute promptly upon receipt thereof
(i) any indemnity payment or expense reimbursement received by it from
JetBlue in respect of any Trustee, any Liquidity Provider, any Policy Provider,
any Paying Agent, any Depositary or any Escrow Agent (collectively, the “Payees”) and (ii) any compensation
received by it from JetBlue under any Operative Agreement in respect of any
Payee, directly to the Payee entitled thereto.


 


Section 2.5.            Designated
Representatives.  (a) With
the delivery of this Agreement, the Subordination Agent shall furnish to each
Liquidity Provider, the Policy Provider and each Trustee, and from time to time
thereafter may furnish to each Liquidity Provider, the Policy


 


30

















 


Provider and each Trustee, at the Subordination
Agent’s discretion, or upon any Liquidity Provider’s, the Policy Provider’s or
Trustee’s request (which request shall not be made more than one time in any
12-month period), a certificate (a “Subordination
Agent Incumbency Certificate”) of a Responsible Officer of the
Subordination Agent certifying as to the incumbency and specimen signatures of
the officers of the Subordination Agent and the attorney-in-fact and agents of
the Subordination Agent (the “Subordination
Agent Representatives”) authorized to give Written Notices on behalf
of the Subordination Agent hereunder. 
Until each Liquidity Provider, the Policy Provider and Trustee receives
a subsequent Subordination Agent Incumbency Certificate, it shall be entitled
to rely on the last Subordination Agent Incumbency Certificate delivered to it
hereunder.


 


(b)           With the delivery of this Agreement,
each Trustee shall furnish to the Subordination Agent, and from time to time
thereafter may furnish to the Subordination Agent, at such Trustee’s
discretion, or upon the Subordination Agent’s request (which request shall not
be made more than one time in any 12-month period), a certificate (a “Trustee Incumbency Certificate”) of a
Responsible Officer of such Trustee certifying as to the incumbency and
specimen signatures of the officers of such Trustee and the attorney-in-fact
and agents of such Trustee (the “Trustee
Representatives”) authorized to give Written Notices on behalf of
such Trustee hereunder.  Until the
Subordination Agent receives a subsequent Trustee Incumbency Certificate, it
shall be entitled to rely on the last Trustee Incumbency Certificate delivered
to it hereunder.


 


(c)           With the delivery of this Agreement,
each Liquidity Provider and the Policy Provide shall furnish to the
Subordination Agent, and from time to time thereafter may furnish to the
Subordination Agent, at such Liquidity Provider’s or Policy Provider’s
discretion, or upon the Subordination Agent’s request (which request shall not
be made more than one time in any 12-month period), a certificate (each a “Provider Incumbency Certificate”) of any
Responsible Officer of such Liquidity Provider or Policy Provider certifying as
to the incumbency and specimen signatures of any officer, attorney-in-fact,
agent or other designated representative of such Liquidity Provider or Policy
Provider (in each case the “Provider
Representatives” and, together with the Subordination Agent
Representatives and the Trustee Representatives, the “Designated Representatives”) authorized to
give Written Notices on behalf of such Liquidity Provider or Policy Provider
hereunder.  Until the Subordination
Agent receives a subsequent Provider Incumbency Certificate, it shall be
entitled to rely on the last Provider Incumbency Certificate delivered to it
hereunder by the relevant Liquidity Provider or the Policy Provider.


 


Section 2.6.            Controlling Party.  (a) Except as provided in
Section 2.6(c), 2.6(d) and 9.1(b) hereof, the Trustees, the Liquidity
Providers and the Policy Provider hereby agree that, with respect to any
Indenture at any given time, the Loan Trustee thereunder will be directed
(including, without limitation, any direction to vote the Equipment Notes in
any bankruptcy proceeding of JetBlue) by the Controlling Party in accordance
with the terms and conditions hereof.


 


(b)           The Person who shall be the
“Controlling Party” with respect to any Indenture shall be:  (x) the Policy Provider or, (i) if
a Policy Provider Default has occurred and is continuing, or (ii) if the
Policy Provider has been released from its obligations under the Policies


 


31

















 


(and such Policies have been returned to the Policy
Provider) and all obligations owing to the Policy Provider hereunder and under
any Policy Provider Document that are distributable pursuant to this Agreement
have been paid in full, until the Final Distribution on the Class G-1 and Class
G-2 certificates has been made, the Class G-1 Trustee and Class G-2
Trustee, jointly, acting upon the instructions of the holders of a majority of
the aggregate fractional undivided interests in both the Class G-1 Trust and
Class G-2 Trust acting as a single class; and (y) upon payment of
(i) Final Distributions to the holders of the Class G-1 Certificates
and the Class G-2 Certificates and (ii) unless a Policy Provider
Default has occurred and is continuing, all obligations owing to the Policy
Provider hereunder or under any Policy Provider Document that are distributable
pursuant to this Agreement, the Class C Trustee; provided that, if
the Policy Provider makes a payment in full on a Policy Drawing in respect of a
Preference Amount after the payment of the Final Distributions to the
Class G-1 and Class G-2 Certificateholders, so long as no Policy Provider
Default has occurred and is continuing, the Policy Provider will be the
Controlling Party until no Policy Provider Obligations remain outstanding, and
thereafter, the Class C Trustee. 
For purposes of giving effect to the foregoing provisions of
Section 2.6(a) above and this Section 2.6(b), the Trustees (other
than the Controlling Party) irrevocably agree (and the Certificateholders
(other than the Certificateholders represented by the Controlling Party) shall
be deemed to agree by virtue of their purchase of Certificates) that the Subordination
Agent, as record holder of the Equipment Notes, shall exercise its voting
rights in respect of the Equipment Notes as directed by the Controlling Party,
subject to Article IX hereof, and any vote so exercised shall be binding
upon the Trustees and all Certificateholders.


 


The Subordination
Agent shall give written notice to all of the other parties to this Agreement
promptly upon a change in the identity of the Controlling Party.  Each of the parties hereto agrees that it
shall not exercise any of the rights of the Controlling Party at such time as
it is not the Controlling Party hereunder; provided, however, that nothing
herein contained shall prevent or prohibit any Non-Controlling Party from
exercising such rights as shall be specifically granted to such Non-Controlling
Party hereunder and under the other Operative Agreements.


 


(c)           Notwithstanding the foregoing, at any
time after 18 months from the earliest to occur of (i) the date on which
the entire Available Amount under any Primary Liquidity Facility shall have
been drawn (excluding a Downgrade Drawing, a Non-Extension Drawing or a Special
Termination Drawing but including a Final Drawing or a Downgrade Drawing,
Non-Extension Drawing or Special Termination Drawing that has been converted to
a Final Drawing under such Primary Liquidity Facility) and remain unreimbursed,
(ii) the date on which the entire amount of any Downgrade Drawing,
Non-Extension Drawing or Special Termination Drawing under a Primary Liquidity
Facility shall have become and remain “Applied Downgrade Advances” or “Applied
Non-Extension Advances” or “Applied Special Termination Advances”, as the case
may be, under and as defined in such Primary Liquidity Facility and
(iii) the date on which all Equipment Notes shall have been Accelerated
(provided that, with respect to the period prior to the Delivery Period Expiry
Date, such Equipment Notes have an aggregate outstanding principal balance of
in excess of $300 million), the Primary Liquidity Provider with the highest
outstanding amount of Liquidity Obligations owed to it (so long as such Primary
Liquidity Provider has not defaulted in its obligation to make any Drawing
under any of its Primary Liquidity Facilities) shall have the right to elect,
by Written Notice to the Subordination Agent, the Policy Provider and each of
the Trustees, to become the Controlling Party hereunder with respect to any
Indenture at any time from and including the last day of such


 


32

















 


18-month period; provided, however, that
if within 15 Business Days after its receipt of any such written notice from
such Primary Liquidity Provider the Policy Provider pays to the Class G-1
Primary Liquidity Provider, the Class G-2 Primary Liquidity Provider and
the Class C Primary Liquidity Provider all outstanding Drawings under each
Primary Liquidity Facility together with accrued interest thereof (as so
determined) in respect of the Class G-1 Primary Liquidity Facility, the
Class G-2 Primary Liquidity Facility and the Class C Primary
Liquidity Facility, respectively, then the Policy Provider rather than such
Primary Liquidity Provider shall be the Controlling Party (x) so long as
no Policy Provider Default has occurred and is continuing and (y) the
Policy Provider thereafter pays to each of the Class G-1 and Class G-2
Primary Liquidity Providers all subsequent Drawings, together with accrued
interest thereon, under the respective Primary Liquidity Facility as and when
such obligations become due (which payments shall be applied by such Primary
Liquidity Provider as repayments of such Drawings and accrued interest
thereon), provided, further, however, that upon any such Policy Provider
Default or the failure to comply with clause (y) of this Section 2.6(c),
such Primary Liquidity Provider, if it so elects and if Liquidity Obligations
owing to it remain outstanding, or, if it does not so elect or if no such
Liquidity Obligations remain outstanding, the Person determined to be the
Controlling Party in accordance with Section 2.06(b), shall become the
Controlling Party.


 


(d)           Notwithstanding the foregoing, if any
holders of the Class C Certificates exercise their right under Section 2.7
hereof to purchase all of the Series G-1 and Series G-2 Equipment Notes issued
under an Indenture, the holders of the majority in aggregate unpaid principal
amount of such Series G-1 and Series G-2 Equipment Notes shall be the
Controlling Party with respect to such Indenture.


 


(e)           The exercise of remedies by the
Controlling Party under this Agreement shall be expressly limited by
Section 4.1(a)(ii) hereof.


 


(f)            The Controlling Party shall not be
entitled to require or obligate any Non-Controlling Party to provide funds
necessary to exercise any right or remedy hereunder.


 


(g)           Notwithstanding anything contained
herein to the contrary, neither the Controlling Party nor the Subordination
Agent shall be authorized or empowered to do anything that would cause any
Trust to fail to qualify as a “grantor trust” for federal income tax purposes.


 


Section 2.7.            Buy Out Right.  (a) If an Indenture Event of Default under
an Indenture has occurred and is continuing, (A) during the period
commencing upon the occurrence of such Indenture Event of Default and ending on
the date occurring six months after the earlier of (x) the Acceleration of
the Equipment Notes issued under such Indenture or (y) the occurrence of a
JetBlue Bankruptcy Event and (B) at any time after such Indenture Event of
Default has occurred and been continuing for five years without an Actual Disposition
Event occurring with respect to the Equipment Notes issued under such
Indenture, with 30 days’ written notice to the Policy Provider, the
Subordination Agent, the Class G-1 Trustee and Class G-2 Trustee and the Class
C Certificateholders, all, but not less than all, of the Series G-1 and Series
G-2 Equipment Notes issued with respect to such Indenture may be purchased from
the Class G-1 Trustee and the Class G-2 Trustee by a holder of the Class C
Certificates for the amounts set forth in clause (b) below.  If prior to the end of such 30 day period,
any other holder of the Class C Certificates notifies the purchasing Class C
Certificateholder, the Policy Provider and the


 


33

















 


Subordination Agent that it wants to participate in
such purchase, then such other Certificateholder may join with the purchasing
Certificateholder to purchase such Equipment Notes pro rata based on the
interest in the Class C Trust held by each Certificateholder.


 


(b)           Upon each purchase by Class C
Certificateholders of Series G-1 and Series G-2 Equipment Notes pursuant to
Section 2.7(a) (such Certificateholders, the “Class C Purchasers”), on such date of purchase (each, a “Purchase Date”) the Class C Purchasers
shall (i) pay to the Class G-1 Trustee and the Class G-2 Trustee the
respective outstanding principal amount of such Series G-1 or Series G-2
Equipment Note held by such Trustee (less the amount of any Policy Drawings
paid in respect of such Equipment Note), together with any accrued and unpaid
interest in respect of such Equipment Notes (but not to exceed the amount of
interest payable on that portion of the Class G-1 or Class G-2 Certificates
corresponding to such Series G-1 or Series G-2 Equipment Note), to but not
including such Purchase Date, and Break Amount, if any, but without any
Prepayment Premium and (ii) pay to the Policy Provider the amount of any
Policy Drawings made by the Policy Provider in respect of such Equipment
Note.  The amounts received by the Class
G-1 and Class G-2 Trustees pursuant to this clause (b) attributable to
principal of the purchased Series G-1 and G-2 Equipment Notes shall be
distributed to the holders of the Class G-1 and Class G-2 Certificates,
respectively, in reduction of the Pool Balance of their Certificates and the
amounts attributable to interest shall be distributed to such
Certificateholders as interest in respect of the amount of such reduction in
the Pool Balance.


 


(c)           On the first Purchase Date, the Class
C Purchasers shall pay (i) to each Primary Liquidity Provider all outstanding
Liquidity Obligations owing to such Primary Liquidity Provider as of such
Purchase Date and (ii) to the Policy Provider all outstanding Policy Provider
Obligations owing to the Policy Provider in respect of (x) any Interest
Drawings paid by the Policy Provider due to a failure of any Liquidity Provider
to perform its obligations under the related Liquidity Facility and any accrued
and unpaid interest on such Interest Drawings and (y) if the Policy Provider
has elected to pay the Primary Liquidity Provider all outstanding Drawings and
interest thereon owing to the Primary Liquidity Provider, the amount of such
outstanding Drawings and interest thereon (after application of any available
funds in the applicable Primary Cash Collateral Account resulting from a
Non-Extension Drawing or Downgrade Drawing paid by such Primary Liquidity
Provider) and deliver to the Subordination Agent, as replacement for each
existing Primary Liquidity Facility, a Replacement Primary Liquidity Facility,
with an initial Available Amount equal to the applicable Required Amount less
the amount of any outstanding Interest Drawing as of such Purchase Date
(without giving effect to any payment to the Primary Liquidity Provider
pursuant to this Section 2.7(c)); provided that no Replacement Primary
Liquidity Facility shall be delivered for any Primary Liquidity Facility under
which a Final Drawing or a Special Termination Drawing has been made. Each
Replacement Primary Liquidity Facility delivered under this clause (ii) shall
be subject to the provisions of Section 3.6(e)(iii), (iv) and (v).  No consent of JetBlue or the Policy Provider
shall be required for any Replacement Primary Liquidity Facility delivered
pursuant to this Section 2.7(c), provided that the provider of such
Replacement Primary Liquidity Facility shall not be one of the entities (not
more that five) specified by the Policy Provider.  JetBlue shall have no greater duties, obligations or liabilities
under any Operative Agreement or Financing Agreement as a result of the
delivery of, or performance by, such Replacement Primary Liquidity Facility.


 


34

















 


(d)           The Class C Purchasers on each
subsequent Purchase Date shall pay the purchase price as provided in
Section 2.7(b) and in addition, pay to the previous Class C Purchasers a
pro rata portion of the amount of Liquidity Obligations and Policy Provider
Obligations, if any, paid by such previous Class C Purchasers pursuant to
Section 2.7(c) and not reimbursed to them as of such subsequent Purchase
Date, based on the total number of Class C Purchasers (including the Class C
Purchasers purchasing on such subsequent Purchase Date).


 


(e)           Upon payment of the Liquidity
Obligations and the Policy Provider Obligations, if any, pursuant to
Section 2.7(c) and (d), the Class C Purchasers shall be subrogated to the
right of the replaced Primary Liquidity Providers in respect of such Liquidity
Obligations (or Policy Provider in respect of such Policy Provider Obligations)
pursuant to Sections 2.4(a), 2.6(c) and 3.2 and shall have priority in
distributions over any Liquidity Obligations owing to the Replacement Primary
Liquidity Providers.  Unless (i) a
Performing Note Deficiency exists and a Liquidity Event of Default shall have
occurred and be continuing with respect to the relevant Replacement Primary
Liquidity Facility or (ii) a Final Drawing a Downgrade Drawing, a
Non-Extension Drawing or a Special Termination Drawing shall have occurred with
respect to such Replacement Primary Liquidity Facility, the initial Available
Amount under each Replacement Primary Liquidity Facility shall be increased
(but not in excess of the related Required Amount) pro tanto to the extent of
reimbursements received by the Class C Purchasers in respect of that portion of
the Liquidity Obligations representing the principal portion of Drawings under
the related replaced Primary Liquidity Facility or such Policy Provider
Obligations by an amount equal to the product of (i) the then Required Amount
(calculated as if no Interest Drawing is outstanding), and (ii) a fraction, the
numerator of which is the amount of such reimbursement (assuming that Interest
Drawings are reimbursed in the order in which they were made) in respect of
principal of such Interest Drawing and the denominator of which is the Required
Amount at the date of such Interest Drawing (calculated as if no Interest
Drawing was then outstanding and on the basis of the lower of the applicable
Stated Interest Rate and the applicable Capped Interest Rate as of such date).


 


(f)            After the holders of the Class C
Certificates have purchased any Series G-1 and Series G-2 Equipment Notes in
accordance with Section 2.7(a), any proceeds or payments made with respect
to such Series G-1 and Series G-2 Equipment Notes will be paid directly to the
holders of such Equipment Notes pro rata and will not be subject to application
under Article III hereof.  Any
proceeds or payments made with respect to any Series C Equipment Notes issued
under the related Indenture will continue to be paid to the Subordination Agent
and be applied in accordance with Article III hereof.


 


ARTICLE III


 


RECEIPT,
DISTRIBUTION AND APPLICATION OF AMOUNTS RECEIVED


 


Section
3.1.            Written
Notice of Distribution. 
(a) No later than 3:00 P.M. (New York City time) on the Business
Day immediately preceding each Regular Distribution Date (or Special
Distribution Date for purposes of Section 2.4(b) hereof, as the case may
be), each of the following Persons shall deliver to the Subordination Agent a
Written Notice setting forth the following information as at the close of
business on such Business Day:


 


35

















 


(i)            With
respect to the Class G-1 Certificates and Class G-2 Certificates, the
Class G-1 Trustee and Class G-2 Trustee shall separately set forth
the amounts to be paid in accordance with clauses “eighth” and “tenth” of
Section 3.2 hereof;


 


(ii)           With
respect to the Class C Certificates, the Class C Trustee shall
separately set forth the amounts to be paid in accordance with clauses “ninth”,
“twelfth” and “thirteenth” of Section 3.2 hereof;


 


(iii)          With
respect to each Primary Liquidity Facility, the Primary Liquidity Provider
thereunder shall separately set forth the amounts to be paid to it in
accordance with clauses “‘first”, “second”, “third”, “fourth” and “fifth” of
Section 3.2 hereof;


 


(iv)          The
Policy Provider shall set forth the amounts to be paid to it in accordance with
clauses “first”, “second”, “third”, “fourth”, “eleventh” and “fourteenth” of
Section 3.2 hereof; and


 


(v)           Each
Trustee shall set forth the amounts to be paid in accordance with clause
“seventh” of Section 3.2 hereof.


 


The notices required under this Section 3.1(a) may be in the form
of a schedule or similar document provided to the Subordination Agent by the
parties referenced therein or by any one of them, which schedule or similar
document may state that, unless there has been a prepayment of the
Certificates, such schedule or similar document is to remain in effect until
any substitute notice or amendment shall be given to the Subordination Agent by
the party providing such notice.


 


(b)           Following the occurrence of a
Triggering Event, the Subordination Agent shall request the following
information from the following Persons, and each of the following Persons
shall, upon the request of the Subordination Agent, deliver a Written Notice to
the Subordination Agent setting forth for such Person the following
information:


 


(i)            With
respect to the Class G-1 Certificates and Class G-2 Certificates, the
Class G-1 Trustee and Class G-2 Trustee shall separately set forth
the amounts to be paid in accordance with clauses “first”, “seventh” (to
reimburse payments made by such Trustee or the Class G-1 Certificateholders
and Class G-2 Certificateholders pursuant to subclause (ii) or (iv) of
clause “first” and subclauses (ii) and (iii) of clause “seventh” of
Section 3.2 hereof), “eighth” and “tenth” of Section 3.2 hereof;


 


(ii)           With
respect to the Class C Certificates, the Class C Trustee shall
separately set forth the amounts to be paid in accordance with clauses “first”,
“seventh” (to reimburse payments made by such Trustee or the Class C
Certificateholders pursuant to subclause (ii) or (iv) of clause “first” and
subclauses (ii) and (iii) of clause “sixth” of Section 3.2 hereof),
“ninth”, “twelfth” and “thirteenth” of Section 3.2 hereof;


 


(iii)          With
respect to each Primary Liquidity Facility, the Primary Liquidity Provider
thereunder shall separately set forth the amounts to be paid to it in


 


36

















 


accordance
with subclause (iv) of clause; “first” of Section 3.2 hereof, subclause
(i) of clause “second” and clauses “third”, “fourth” and “fifth” of
Section 3.2 hereof;


 


(iv)          The
Policy Provider shall separately set forth amounts to be paid to it in
accordance with subclause (iii) of clause “first” of Section 3.2 hereof,
subclause (ii) of clause “second”, subclauses (ii) and (iii) of clause “third”,
subclause (II) of clause “fourth”, clause “eleventh” and clause “fourteenth” of
Section 3.2 hereof; and


 


(v)           Each
Trustee shall set forth the amounts to be paid in accordance with clause
“seventh” of Section 3.2 hereof.


 


(c)           At such time as a Trustee, a Primary
Liquidity Provider or the Policy Provider shall have received all amounts owing
to it (and, in the case of a Trustee, the Certificateholders for which it is
acting) pursuant to Section 2.4, 3.2 or 3.7 hereof, as applicable, and, in
the case of a Primary Liquidity Provider or the Policy Provider, its commitment
or obligations under the related Primary Liquidity Facility or the Policy, as
the case may be, shall have terminated or expired, such Person shall, by a
Written Notice, so inform the Subordination Agent and each other party to this
Agreement.


 


(d)           As provided in Section 6.5
hereof, the Subordination Agent shall be fully protected in relying on any of
the information set forth in a Written Notice provided by any Trustee, any
Primary Liquidity Provider or the Policy Provider pursuant to paragraphs (a)
through (c) above and shall have no independent obligation to verify, calculate
or recalculate any amount set forth in any Written Notice delivered in
accordance with such paragraphs.


 


(e)           Any Written Notice delivered by a
Trustee, a Liquidity Provider, the Policy Provider or the Subordination Agent,
as applicable, pursuant to Section 3.1(b), 3.1(c) or 3.7 hereof, if made
prior to 10:00 A.M. (New York City time) on any Business Day shall be effective
on the date delivered (or if delivered later on a Business Day or if delivered
on a day which is not a Business Day shall be effective as of the next Business
Day).  Subject to the terms of this
Agreement, the Subordination Agent shall as promptly as practicable comply with
any such instructions; provided, however, that any transfer of funds pursuant
to any instruction received after 10:00 A.M. (New York City time) on any
Business Day maybe made on the next succeeding Business Day.


 


(f)            In the event the Subordination Agent
shall not receive from any Person any information set forth in paragraph (a) or
(b) above which is required to enable the Subordination Agent to make a
distribution to such Person pursuant to Section 2.4 or 3.2 hereof, the
Subordination Agent shall request such information and, failing to receive any
such information, the Subordination Agent shall not make such distribution(s)
to such Person.  In such event, the
Subordination Agent shall make distributions pursuant to clauses “first”
through “sixteenth” of Section 3.2 to the extent it shall have sufficient
information to enable it to make such distributions, and shall continue to hold
any funds remaining, after making such distributions, until the Subordination
Agent shall receive all necessary information to enable it to distribute any
funds so withheld.


 


37

















 


(g)           On such dates (but not more
frequently than monthly) as any Liquidity Provider, the Policy Provider or any
Trustee shall request, but in any event automatically at the end of each
calendar quarter, the Subordination Agent shall send to such party a written
statement reflecting all amounts on deposit with the Subordination Agent
pursuant to Section 3.1(f) hereof and, in the case of the quarterly
report, the amounts distributed on each Regular Distribution Date and any
Special Distribution Date occurring during the quarter then ended.


 


Section
3.2.            Distribution
of Amounts on Deposit in the Collection Account.  Except as otherwise provided in
Sections 2.4, 3.1(f), 3.4 and 3.6(b), amounts on deposit in the Collection
Account shall be promptly distributed on each Regular Distribution Date (or, in
the case of any Special Payment, on the Special Distribution Date thereof) in
the following order of priority and in accordance with the information provided
to the Subordination Agent pursuant to Section 3.1(a) hereof:


 


first,
such amount as shall be required to reimburse (i) the Subordination Agent
for any reasonable out-of-pocket costs and expenses actually incurred by it (to
the extent not previously reimbursed) in the protection of, or the realization
of the value of, the Equipment Notes or any Collateral, shall be applied by the
Subordination Agent in reimbursement of such costs and expenses, (ii) each
Trustee for any amounts of the nature described in clause (i) above actually
incurred by it under the applicable Trust Agreement (to the extent not
previously reimbursed), shall be distributed to such Trustee, (iii) the
Policy Provider for any amounts of the nature described in clause (i) above
actually incurred by it (to the extent not previously reimbursed), shall be
distributed to the Policy Provider, (iv) any Primary Liquidity Provider,
the Policy Provider or any Certificateholder for payments, if any, made by it
to the Subordination Agent or any Trustee in respect of amounts described in
clause (i) above actually incurred by it (to the extent not previously
reimbursed), shall be distributed to the Primary Liquidity Provider, the Policy
Provider or such Certificateholder and (v) if the Subordination Agent
shall have requested the initial Post-Default Appraisals, to fund or replenish
the Reserve Account up to the Reserve Amount, but in no event (other than the
initial funding of the Reserve Account) more than $25,000 in the aggregate
during any calendar year, shall be distributed to the Subordination Agent, in
each such case, pro rata on the basis of all amounts described in clauses (i)
through (v) above;


 


second,
such amount then remaining as shall be required to pay (i) all accrued and
unpaid Liquidity Expenses owed to each Primary Liquidity Provider and
(ii) all accrued and unpaid Policy Expenses owed to the Policy Provider,
shall be distributed to each Primary Liquidity Provider and the Policy Provider
pro rata on the basis of the amount of Liquidity Expenses and Policy Expenses
owed to each Primary Liquidity Provider and the Policy Provider;


 


third,
such amount then remaining as shall be required to pay (i) the aggregate
amount of interest accrued and unpaid on all Liquidity Obligations (at the
rate, or in the amount, provided in the applicable Primary Liquidity Facility)
(determined after the application of the proceeds of any Excess Interest Policy
Drawing or other payment by the Policy Provider to the applicable Primary
Liquidity Provider in accordance with the


 


38

















 


provisions of
Section 2.6(c)), (ii) the aggregate amount of any Policy Provider
Interest Obligations, (iii) if the Policy Provider has elected pursuant to
the proviso to Section 2.6(c) to pay to each Primary Liquidity Provider
all outstanding Drawings and interest thereon owing to such Primary Liquidity
Provider under the applicable Primary Liquidity Facility (to the extent not
included in the definition of Excess Reimbursement Obligations), the amount of
such payment made to such Primary Liquidity Provider attributable to interest
accrued on such Drawings, and (iv) if one or more Special Termination
Drawings have been made under the Primary Liquidity Facilities that have not
been converted into Final Advances, the outstanding amount of such Special
Termination Drawings, shall be distributed to the Primary Liquidity Provider
and the Policy Provider pro rata on the basis of the amount of such Liquidity
Obligations owed to such Primary Liquidity Provider and the amount of such
Policy Provider Obligations payable under this clause “third” to the Policy
Provider;


 


fourth,
such amount then remaining as shall be required (I)(A) if any Primary Cash
Collateral Account had been previously funded as provided in
Section 3.6(f), unless (i) a Performing Note Deficiency exists and a
Liquidity Event of Default shall have occurred and be continuing with respect
to the relevant Primary Liquidity Facility or (ii) a Final Drawing shall have
occurred with respect to such Primary Liquidity Facility, to fund such Primary
Cash Collateral Account up to its Required Amount (calculated as if there are
no unreimbursed Interest Drawings under such Primary Liquidity Facility) shall
be deposited in such Primary Cash Collateral Account, (B) if any Primary
Liquidity Facility shall become a Downgraded Facility or a Non-Extended
Facility at a time when unreimbursed Interest Drawings under such Primary
Liquidity Facility have reduced the Available Amount thereunder to zero, unless
(i) a Performing Note Deficiency exists and a Liquidity Event of Default
shall have occurred and be continuing with respect to the relevant Primary
Liquidity Facility or (ii) a Final Drawing shall have occurred with
respect to such Primary Liquidity Facility, to fund the related Primary Cash
Collateral Account up to such Primary Cash Collateral Account’s Required Amount
(calculated as if there are no unreimbursed Interest Drawings under such
Primary Liquidity Facility) shall be deposited in such Primary Cash Collateral
Account, and (C) if, with respect to any particular Primary Liquidity
Facility, neither subclause (I)(A) nor subclause (I)(B) of this clause “fourth”
are applicable, to pay in full the outstanding amount of all Liquidity Obligations
(net of any and all payments made by the Policy Provider to the Primary
Liquidity Provider in respect of the principal amount of Interest Advances)
then due under such Primary Liquidity Facility (other than amounts payable
pursuant to clause “second” or “third” of this Section 3.2) and
(II) if the Policy Provider has elected pursuant to the proviso to
Section 2.6(c) to pay to each Primary Liquidity Provider all outstanding
Drawings and interest thereon owing to such Primary Liquidity Provider under
the applicable Primary Liquidity Facility or if the Policy Provider has made
any Policy Drawings pursuant to Section 3.7(a) as a result of the failure of
the relevant Primary Liquidity Provider to honor any Interest Drawings in
accordance with Section 2.02(a) of the applicable Primary Liquidity Facility in
respect of the Class G-1 Certificates or Class G-2 Certificates, as the case
maybe, the amount of such payment made to such Primary Liquidity Provider in
respect of principal of Drawings under such Primary Liquidity Facility and the
amount of such Policy Drawing, as applicable, shall be distributed to such
Primary Liquidity Provider and the Policy Provider, pro rata on the


 


39

















 


basis of the
amounts of all such deficiencies and/or unreimbursed Liquidity Obligations in
respect of each Primary Liquidity Provider and the amount of such unreimbursed
Policy Provider Obligations payable under this clause “fourth” to the Policy
Provider;


 


fifth,
if, with respect to any particular Primary Liquidity Facility, any amounts are
to be distributed pursuant to either subclause (I)(A) or (I)(B) of clause
“fourth” above, such amount then remaining as shall be required to pay the
Primary Liquidity Provider with respect to such Primary Liquidity Facility the
excess of (x) the aggregate outstanding amount of unreimbursed Advances
(whether or not then due) under such Primary Liquidity Facility over
(y) the Required Amount for the relevant Class, pro rata on the basis of
such amounts in respect of each Primary Liquidity Provider;


 


sixth,
if any Above-Cap Reserve Account had been previously funded as provided in
Section 3.6(f), unless (i) a Performing Note Deficiency exists and a
Liquidity Event of Default shall have occurred and be continuing with respect
to the related Primary Liquidity Facility or (ii) a Final Drawing shall
have occurred with respect to such Primary Liquidity Facility, to fund such
Above-Cap Reserve Account up to an amount equal to the applicable Termination
Amount (as recalculated on such Distribution Date) less any amount then on
deposit in the related Above-Cap Account shall be deposited in such Above-Cap
Reserve Account;


 


seventh,
such amount then remaining as shall be required to reimburse or pay
(i) the Subordination Agent for any Tax (other than Unindemnified Taxes),
expense, fee, charge or other loss incurred by or any other amount payable to
the Subordination Agent in connection with the transactions contemplated hereby
(to the extent not previously reimbursed), shall be applied by the
Subordination Agent in reimbursement of such amount, (ii) each Trustee for
any Tax (other than Unindemnified Taxes), expense, fee, charge, loss or any
other amount payable to such Trustee under the applicable Trust Agreements (to the
extent not previously reimbursed), shall be distributed to such Trustee, and
(iii) each Certificateholder for payments, if any, made by it pursuant to
Section 5.2 hereof in respect of amounts described in clause (i) above,
shall be distributed to the applicable Trustee for the account of such
Certificateholder, in each such case, pro rata on the basis of all amounts
described in clauses (i) through (iii) above;


 


eighth,
such amount then remaining as shall be required to pay accrued and unpaid
interest at the Stated Interest Rate on the Class G-1 Certificates and
Class G-2 Certificates (excluding interest, if any, payable with respect
to the Deposits relating to such Trusts) shall be distributed to the
Class G-1 Trustee and Class G-2 Trustee; provided that if available
funds are insufficient to pay such interest in full to each such Class
available funds will be distributed to each of the Class G-1 Trustee and
the Class G-2 Trustee in the same proportion as such Trustee’s
proportionate share of the aggregate amount of such interest;


 


ninth,
such amount then remaining as shall be required to pay unpaid Adjusted Interest
on the Class C Certificates to the holders of the Class C Certificates
(excluding interest, if any, payable with respect to the Deposits relating to
the Class C Trust);


 


40

















 


tenth,
such amount then remaining as shall be required to pay in full Expected
Distributions on the Class G-1 Certificates and Class G-2 Certificates shall be
distributed to the Class G-1 Trustee and Class G-2 Trustee; provided that if
available funds are insufficient to pay Expected Distributions to each such
Class in full, available funds will be distributed to each of the Class G-1
Trustee and the Class G-2 Trustee in the same proportion as such Trustee’s
proportionate share of the aggregate amount of such Expected Distribution;


 


eleventh,
such amount then remaining as shall be required to pay to the Policy Provider
all Policy Provider Obligations then due to the Policy Provider under the
Policy Provider Agreement (other than amounts payable pursuant to clauses
“first”, “second”, “third” and “fourth” of this Section 3.2 and Excess
Reimbursement Obligations) and amounts due under the Policy Fee Letter shall be
paid to the Policy Provider;


 


twelfth,
such amount then remaining as shall be required to pay in full interest then
due at the Stated Interest Rate on the Pool Balance of the Class C Certificates
which was not previously paid pursuant to clause “ninth” above to the holders
of the Class C Certificates (excluding interest, if any, payable with respect
to the Deposits related to the Class C Trust);


 


thirteenth,
such amount then remaining as shall be required to pay in full Expected
Distributions on the Class C Certificates shall be distributed to the
Class C Trustee;


 


fourteenth,
such amount then remaining as shall be required to pay in full any Excess
Reimbursement Obligations shall be distributed to the Policy Provider;


 


fifteenth,
if any Above-Cap Reserve Account had been previously funded as provided in
Section 3.6(f), unless (i) a Performing Note Deficiency exists and a
Liquidity Event of Default shall have occurred and be continuing with respect
to the related Primary Liquidity Facility or (ii) a Final Drawing shall
have occurred with respect to such Primary Liquidity Facility, to fund such
Above-Cap Reserve Account up to an amount equal to the applicable Termination
Amount (as recalculated on such Distribution Date) shall be deposited in such
Above-Cap Reserve Account; and


 


sixteenth,
such amount then remaining shall be deposited in the Collection Account to be
distributed on the next Distribution Date.


 


Section
3.3.            [Intentionally
Omitted].


 


Section 3.4.            Other Payments.  (a) Any payments received by the
Subordination Agent for which no provision as to the application thereof is
made in this Agreement shall be distributed by the Subordination Agent in the
order of priority specified in Section 3.2.


 


(b)           If the Subordination Agent receives
any Scheduled Payment after the Scheduled Payment Date relating thereto, but
prior to such payment becoming an Overdue Scheduled Payment, then the
Subordination Agent shall deposit such Scheduled Payment in the Collection
Account and promptly distribute such Scheduled Payment in accordance with the


 


41

















 


priority of distributions set forth in
Section 3.2 hereof; provided that, for the purposes of this
Section 3.4(b) only, each determination made in clauses “eighth”, “ninth”,
“tenth”, “twelfth” or “thirteenth” of Section 3.2 by use of the definition
of “Distribution Date” shall be deemed to refer to such Scheduled Payment Date.


 


Section
3.5.            Payments
to the Trustees, Primary Liquidity Providers and Policy Provider.  Any amounts distributed hereunder to any
Primary Liquidity Provider or the Policy Provider shall be paid to such Primary
Liquidity Provider or Policy Provider by wire transfer of funds to the address
such Primary Liquidity Provider or Policy Provider shall provide to the
Subordination Agent.  The Subordination
Agent shall provide a Written Notice of any such transfer to the applicable
Primary Liquidity Provider or Policy Provider, as the case may be, at the time
of such transfer.  Any amounts
distributed hereunder by the Subordination Agent to any Trustee which shall not
be the same institution as the Subordination Agent shall be paid to such
Trustee by wire transfer funds at the address such Trustee shall provide to the
Subordination Agent.


 


Section
3.6.            Liquidity
Facilities.  (a) Interest
Drawings and Above-Cap Payments.  If
on any Distribution Date, after giving effect to the subordination provisions
of this Agreement and any Election Interest Payments made by the Policy
Provider, the Subordination Agent shall not have sufficient funds for the
payment of any amounts due and owing in respect of accrued interest on the
Class G-1 Certificates or the Class G-2 Certificates or the Adjusted
Interest with respect to the Class C Certificates, other than any amount
of interest or Adjusted Interest which was due and payable on the Class G-1
Certificates, the Class G-2 Certificates or the Class C Certificates on such
Distribution Date but which remains unpaid due to the failure of the Depositary
to pay any amount of accrued interest on the Deposits on such Distribution
Date, then, prior to 12:00 noon (New York City time) on such Distribution Date,
(i) the Subordination Agent shall request a drawing (each such drawing, an
“Interest Drawing”) under the
Primary Liquidity Facility with respect to such Class of Certificates (and
concurrently with the making of such request, the Subordination Agent shall
give notice to the Policy Provider of such insufficiency of funds) in an amount
equal to the lesser of (x) an amount sufficient to pay the amount of such
accrued interest, in the case of the Class G-1 Certificates and the
Class G-2 Certificates, or such Adjusted Interest, in the case of the
Class C Certificates, (at the Stated Interest Rate for such Class of
Certificates) and (y) the Available Amount under such Primary Liquidity
Facility, and upon receipt of such amount shall pay such amount to the Trustee
with respect to such Class of Certificates in payment of such accrued interest,
in the case of the Class G-1 Certificates and the Class G-2 Certificates,
or Adjusted Interest, in the case of the Class C Certificates, and
(ii) if Three-Month LIBOR for the Interest Period ending on such
Distribution Date (or, if such Distribution Date is not the last day of an
Interest Period, Three-Month LIBOR for the Interest Period including such
Distribution Date) exceeds Capped Three-Month LIBOR, the Subordination Agent
shall (if it can make the certification described in the last sentence of this
Section 3.6(a) and the relevant Above-Cap Liquidity Facility has not been terminated
or expired) request an interest rate cap payment (each such payment, an “Above-Cap Payment”) under the Above-Cap
Liquidity Facility with respect to such Class of Certificates, for credit to
the applicable Above-Cap Account in an amount equal to the excess of (1) an
amount equal to the product of (x) the excess of Three-Month LIBOR for the
Interest Period ending on such Distribution Date (or, if such Distribution Date
is not the last day of an Interest Period, Three-Month LIBOR for the Interest
Period including such Distribution Date)


 


42

















 


over Capped Three-Month LIBOR, multiplied by
(y) (A) in the case of the Class G-1 Certificates and
Class G-2 Certificates, the Pool Balance with respect to such Class of Certificates
as of such Distribution Date (and before giving effect to any distribution on
such date) and (B) with respect to the Class C Certificates, the
Preferred C Pool Balance as of such Distribution Date (and before giving effect
to any distribution on such date), multiplied by (z) the actual number of
days elapsed during the period commencing on the first day of such Interest
Period and ending on such Distribution Date divided by 360 over (2) the amount,
if any, on deposit in the Above-Cap Account for such Class of Certificates, and
upon the receipt thereof the Subordination Agent shall immediately deposit such
Above-Cap Payment into the Above-Cap Account for such Class of
Certificates.  If the Interest Drawing
on such Distribution Date pursuant to clause (i) above, together with all other
amounts available to the Subordination Agent on such Distribution Date (after
giving effect to the subordination provisions of this Agreement and any
withdrawals from the applicable Primary Cash Collateral Account but not with
respect to any amounts under either Policy), is insufficient to pay accrued
interest, in the case of the Class G-1 Certificates and the Class G-2
Certificates, or Adjusted Interest, in the case of the Class C Certificates (at
the Stated Interest Rate with respect to such Class of Certificates for the
applicable Interest Period) payable with respect to such Class of Certificates
on such Distribution Date (such deficiency, the “Deficiency Amount”), the Subordination Agent shall, prior to
4:00 p.m. (New York City time) on such Distribution Date, withdraw (each,
an “Above-Cap Withdrawal”) from
the Above-Cap Account with respect to such Class of Certificates an amount
equal to the lesser of (x) such Deficiency Amount and (y) the amount
on deposit in the Above-Cap Account (including any amounts deposited, or to be
deposited, on such Distribution Date pursuant to clause (ii) above), and
shall pay such amount to the Trustee with respect to such Class of Certificates
in payment of such accrued interest, in the case of the Class G-1 Certificates
and the Class G-2 Certificates, or such Adjusted Interest, in the case of the
Class C Certificates.  In connection
with a request for an Above-Cap Payment under any Above-Cap Liquidity Facility
pursuant to clause (ii) above, the Subordination Agent shall certify to
the Above-Cap Liquidity Provider with respect to such Class of Certificates
that at least one of the following statements is true as of such Distribution
Date prior to making such Above-Cap Withdrawal:  (x) the Available Amount under the Primary Liquidity
Facility with respect to such Class of Certificates (prior to giving effect to
any Interest Drawings to be made on such Distribution Date) is greater than
zero or (y) the amount on deposit in the Primary Cash Collateral Account
relating to such Primary Liquidity Facility (prior to giving effect to any
withdrawal to be made from such account on such Distribution Date) is greater
than zero.


 


(b)           Application of Interest Drawings
and Above-Cap Withdrawals.  Notwithstanding
anything to the contrary contained in this Agreement, (i) all payments
received by the Subordination Agent in respect of an Interest Drawing under the
Class G-1 Primary Liquidity Facility and all amounts withdrawn by the
Subordination Agent from the Class G-1 Primary Cash Collateral Account,
and payable in each case to the Class G-1 Trustee on behalf of the
Class G-1 Certificateholders, shall be promptly distributed to the
Class G-1 Trustee, (ii) all payments received by the Subordination
Agent in respect of an Interest Drawing under the Class G-2 Primary
Liquidity Facility and all amounts withdrawn by the Subordination Agent from
the Class G-2 Primary Cash Collateral Account, and payable in each case to
the Class G-2 Trustee on behalf of the Class G-2 Certificateholders,
shall be promptly distributed to the Class G-2 Trustee, (iii) all
payments received by the Subordination Agent in respect of an Interest Drawing
under the Class C Primary Liquidity Facility and all amounts withdrawn by
the


 


43

















 


Subordination Agent from the Class C Primary Cash
Collateral Account, and payable in each case to the Class C Trustee on
behalf of the Class C Certificateholders, shall be promptly distributed to
the Class C Trustee, except, with respect to clauses (i), (ii) and
(iii), that if (x) the Subordination Agent shall receive any amount in
respect of an Interest Drawing under the Class G-1 Primary Liquidity
Facility or Class G-2 Primary Liquidity Facility or a withdrawal from the
Class G-1 Primary Cash Collateral Account or Class G-2 Primary Cash
Collateral Account to pay Accrued Class G-1 Interest or Accrued
Class G-2 Interest after such Accrued Class G-1 Interest or Accrued
Class G-2 Interest has been fully paid by a Policy Drawing under the
Policy, or (y) the Subordination Agent shall receive any amount in respect
of a Policy Drawing under the applicable Policy pursuant to Section 3.7(a)
hereof to pay Accrued Class G-1 Interest or Accrued Class G-2 Interest after
such Accrued Class G-1 Interest or Accrued Class G-2 Interest has been fully
paid by an Interest Drawing under the applicable Primary Liquidity Facility or
a withdrawal from the applicable Primary Cash Collateral Account, then such
amounts shall be paid directly to the Policy Provider as reimbursement of such
Policy Drawing rather than to the Class G-1 Trustee and/or Class G-2
Trustee on behalf of the Class G-1 Certificateholders and/or
Class G-2 Certificateholders and shall constitute an Interest Drawing
under the Class G-1 Primary Liquidity Facility or Class G-2 Primary
Liquidity Facility or a withdrawal from the Class G-1 Primary Cash
Collateral Account or Class G-2 Primary Cash Collateral Account, as the
case may be, hereunder; provided, that if any such amount constitutes an
Election Interest Payment with respect to one or more Series G-1 Equipment
Notes or Series G-2 Equipment Notes, such amount shall be paid directly to the
Class G-1 Primary Liquidity Provider or Class G-2 Primary Liquidity
Provider as reimbursement for such Interest Drawing or to the Class G-1 Primary
Cash Collateral Account or the Class G-2 Primary Cash Collateral Account as
replenishment for such withdrawal, as applicable and (iv) all payments
received by the Subordination Agent in respect of an Above-Cap Withdrawal from
any Above-Cap Account, and payable to (A) the Class G-1 Trustee on
behalf of the G-1 Certificateholders, shall be promptly distributed to the
Class G-1 Trustee, (B) the Class G-2 Trustee on behalf of the
Class G-2 Certificateholders, shall be promptly distributed to the
Class G-2 Trustee, and (C) the Class C Trustee on behalf of the
Class C Certificateholders shall be promptly distributed to the
Class C Trustee for application in each case to the payment of interest in
respect of which it was drawn, except that if (x) the Subordination Agent
shall receive any amount in respect of such Above-Cap Withdrawal to pay Accrued
Class G-1 Interest or Accrued Class G-2 Interest after such Accrued Class
G-1 Interest or Accrued Class G-2 Interest, as applicable, has been fully
paid to the Class G-1 Trustee or Class G-2 Trustee, as applicable, by
a Policy Drawing under the Policies pursuant to Section 3.7(a) hereof or
(y) the Subordination Agent shall receive any amount in respect of a Policy
Drawing under the Policies pursuant to Section 3.7(a) to fully pay Accrued
Class G-1 Interest or Accrued Class G-2 Interest after such Accrued
Class G-1 Interest or Accrued Class G-2 Interest has been paid (in full or
in part) to the Class G-1 Trustee or Class G-2 Trustee by an
Above-Cap Withdrawal, then an amount equal to such amount received in respect
of such Above-Cap Withdrawal shall be paid directly to the Policy Provider as
reimbursement of such Policy Drawing rather than to the Class G-1 Certificateholders
or Class G-2 Certificateholders or the Class G-1 Trustee or
Class G-2 Trustee.


 


(c)           Downgrade Drawings.  (i) Each Primary Liquidity Provider
shall promptly, but in any event within 10 days of receipt of notice of a
Downgrade Event with respect to it, deliver notice of such Downgrade Event to
the Subordination Agent and JetBlue.  If
at any time a Downgrade Event shall have occurred with respect to a Primary
Liquidity Facility (the


 


44

















 


“Downgraded Facility”),
such Primary Liquidity Provider or JetBlue may arrange for a Replacement
Primary Liquidity Provider to issue and deliver a Replacement Primary Liquidity
Facility to the Subordination Agent.  If
a Downgraded Facility has not been replaced in accordance with the terms of
this paragraph, the Subordination Agent shall, if it has actual knowledge of
such Downgrade Event, on the 10th day following such downgrading or on the day
it obtains actual knowledge of such Downgrade Event, if later (or if such day
is not a Business Day, on the next succeeding Business Day) (or, if earlier,
the expiration date of such Downgraded Facility), request a drawing in
accordance with and to the extent permitted by such Downgraded Facility (such
drawing, a “Downgrade Drawing”) of
all available and undrawn amounts thereunder. 
Amounts drawn pursuant to a Downgrade Drawing shall be maintained and
invested as provided in Section 3.6(f) hereof.  The applicable Primary Liquidity Provider may also arrange for a
Replacement Primary Liquidity Provider to issue and deliver a Replacement
Primary Liquidity Facility at any time after such Downgrade Drawing so long as
such Downgrade Drawing has not been reimbursed in full to such Liquidity
Provider.


 


(ii)           If
a “Termination Event” or an “Additional Termination Event” (each as defined in
the Above-Cap Liquidity Facilities, each such event, a “Mandatory Termination Event”) shall occur
under the Class G-1 Above-Cap Liquidity Facility, Class G-2 Above-Cap
Liquidity Facility or Class C Above-Cap Liquidity Facility, the Class G-1
Above-Cap Liquidity Provider, Class G-2 Above-Cap Liquidity Provider or
Class C Above-Cap Liquidity Provider, as applicable, shall provide notice
of such Mandatory Termination Event in writing to JetBlue, the Subordination
Agent, the Policy Provider, the Class G-1 Trustee, the Class G-2
Trustee and the Class C Trustee, and within the time period specified in
such Above-Cap Liquidity Facility (but in no event later than the expiration
date of such Above-Cap Liquidity Facility) JetBlue or such Above-Cap Liquidity
Provider may, in each case at its own expense, arrange for one or more
Replacement Above-Cap Liquidity Providers to issue and deliver a Replacement
Above-Cap Liquidity Facility for such Above-Cap Liquidity Facility to the
Subordination Agent.  In the event that
such Above-Cap Liquidity Provider or JetBlue makes arrangements for a
Replacement Above-Cap Liquidity Facility in accordance with the terms of such
Above-Cap Liquidity Facility, (y) the Subordination Agent shall, if and to
the extent so requested by such Above-Cap Liquidity Provider or JetBlue,
execute and deliver any certificate or other instrument required to give effect
to such replacement and (z) each of the parties hereto shall enter into
any amendments to this Agreement necessary to give effect to such
replacement.  If an Above-Cap Liquidity
Facility is subject to a Mandatory Termination Event and has not been replaced
in accordance with its terms and the terms of this paragraph or if an Early
Termination Date has been designated under such Above-Cap Liquidity Facility
after the occurrence of an Event of Default (as defined in the Above-Cap
Liquidity Facility), such Above-Cap Liquidity Facility shall be terminated and
such Above-Cap Liquidity Provider shall, on such Early Termination Date, pay to
the Subordination Agent, for the benefit of the Class G-1 Trustee,
Class G-2 Trustee of Class C Trustee, as applicable, on behalf of the
holders of the related Class of Certificates, the applicable Termination Amount
for credit to the relevant Above-Cap Reserve Account, to be applied as provided
in Section 3.6(f) hereof plus the amount of all other unpaid sums due and
payable by such Above-Cap Liquidity Provider with respect to such Class of
Certificates thereunder on or prior to such date, and upon such payment, such
Above-Cap Liquidity Facility shall be terminated.  Nothing


 


45

















 


contained
herein shall limit the rights of an Above-Cap Liquidity Provider to transfer its
rights and obligations under its Above-Cap Liquidity Facility or otherwise
arrange for a Replacement Above-Cap Liquidity Facility, subject to and in
accordance with the provisions of such Above-Cap Liquidity Facility.


 


(d)           Non-Extension Drawings.  If any Primary Liquidity Facility with
respect to the Class G-1 Certificates, Class G-2 Certificates or
Class C Certificates is scheduled to expire on a date (the “Stated Expiration Date”) prior to the date
that is 15 days after the Final Legal Distribution Date for such Class of
Certificates, then, no earlier than the 60th day and no later than the 40th day
prior to the then Stated Expiration Date, the Subordination Agent shall request
that such Primary Liquidity Provider extend the Stated Expiration Date to the
earlier of (i) the date that is 15 days after such Final Legal
Distribution Date and (ii) the date that is 364 days after the last day of
the applicable Consent Period (unless the obligations of such Primary Liquidity
Provider thereunder are earlier terminated in accordance with such Primary
Liquidity Facility).  Whether or not the
Primary Liquidity Provider has received such request from the Subordination
Agent, the Primary Liquidity Provider shall advise the Subordination Agent, no
earlier than the 40th day (or, if earlier, the date of such Primary
Liquidity Provider’s receipt of such request) and no later than the 25th
day prior to the Stated Expiration Date then in effect for such Primary
Liquidity Facility (such period, with respect to such Primary Liquidity
Facility, the “Consent Period”),
whether, in its sole discretion, it agrees to so extend the Stated Expiration
Date.  If on or before the last day of
such Consent Period, (A) such Primary Liquidity Facility shall not have
been replaced in accordance with Section 3.6(e) and (B) the Primary
Liquidity Provider fails to irrevocably and unconditionally advise the
Subordination Agent that such Stated Expiration Date shall be so extended, the
Subordination Agent shall, on the last day of the Consent Period (or as soon as
possible thereafter), in accordance with the terms of the expiring Primary
Liquidity Facility (a “Non-Extended Facility”),
request a drawing under such expiring Primary Liquidity Facility (such drawing,
a “Non-Extension Drawing”) of the
Available Amount thereunder.  Amounts
drawn pursuant to a Non-Extension Drawing shall be maintained and invested in
accordance with Section 3.6(f) hereof.


 


(e)           Issuance of Replacement Primary
Liquidity Facility.  (i) At any
time, JetBlue may, at its option, with cause or without cause, arrange for a
Replacement Primary Liquidity Facility to replace any Primary Liquidity
Facility for the Class G-1 Certificates, Class G-2 Certificates or
Class C Certificates (including any Replacement Primary Liquidity Facility
provided pursuant to Section 3.6(e)(ii) hereof); provided, however, that
the initial Primary Liquidity Provider for any Primary Liquidity Facility shall
not be replaced by JetBlue as a Primary Liquidity Provider with respect to such
Primary Liquidity Facility prior to the third anniversary of the Closing Date
unless (A) there shall have become due to such initial Primary Liquidity
Provider, or such initial Primary Liquidity Provider shall have demanded,
amounts pursuant to Section 3.01, 3.02 or 3.03 of any applicable Primary
Liquidity Facility or the Tax Letter and the replacement of such initial
Primary Liquidity Provider would reduce or eliminate the obligation to pay such
amounts or JetBlue determines in good faith that there is a substantial
likelihood that such initial Primary Liquidity Provider will have the right to
claim any such amounts (unless such initial Primary Liquidity Provider waives,
in writing, any right it may have to claim such amounts), which determination
shall be set forth in a certificate delivered by JetBlue to such initial
Primary Liquidity Provider setting forth the basis for such determination and
accompanied by an opinion of outside counsel selected by JetBlue and reasonably
acceptable


 


46

















 


to such initial Primary Liquidity Provider verifying
the legal conclusions, if any, of such certificate relating to such basis,
provided that, in the case of any likely claim for such amounts based upon any
proposed, or proposed change in, law, rule, regulation, interpretation,
directive, requirement, request or administrative practice, such opinion may
assume the adoption or promulgation of such proposed matter, (B) it shall
become unlawful or impossible for such initial Primary Liquidity Provider (or
its Lending Office) to maintain or fund its LIBOR Advances as described in
Section 3.10 of any Primary Liquidity Facility, (C) any Primary
Liquidity Facility of such initial Primary Liquidity Provider shall become a
Downgraded Facility or a Non-Extended Facility or a Downgrade Drawing or a
Non-Extension Drawing or a Special Termination Drawing shall have occurred
under any Primary Liquidity Facility of such initial Primary Liquidity Provider
or (D) such initial Primary Liquidity Provider shall have breached any of
its payment (including, without limitation, funding) obligations under any
Primary Liquidity Facility in respect of which it is the Primary Liquidity
Provider.  If such Replacement Primary
Liquidity Facility is provided at any time after a Downgrade Drawing,
Non-Extension Drawing or a Special Termination Drawing has been made, all funds
on deposit in the relevant Cash Collateral Account will be returned to the
Primary Liquidity Provider being replaced.


 


(ii)           If
any Primary Liquidity Provider shall determine not to extend any of its Primary
Liquidity Facilities in accordance with Section 3.6(d), then such Primary
Liquidity Provider may, at its option, arrange for a Replacement Primary
Liquidity Facility to replace such Primary Liquidity Facility during the period
no earlier than 40 days and no later than 25 days prior to the then effective
Stated Expiration Date of such Primary Liquidity Facility.  At any time after a Non-Extension Drawing
has been made under any Primary Liquidity Facility or at any time after the
Primary Liquidity Provider has extended the Stated Expiration Date pursuant to
Section 2.11 of the related Primary Liquidity Facility, the Primary
Liquidity Provider thereunder may, at its option, arrange for a Replacement
Primary Liquidity Facility to replace the Primary Liquidity Facility under
which such Non-Extension Drawing or extension has been made.


 


(iii)          No
Replacement Primary Liquidity Facility arranged by JetBlue or a Primary
Liquidity Provider in accordance with clause (i) or (ii) above or pursuant to
Section 3.6(c), respectively, shall become effective and no such
Replacement Primary Liquidity Facility shall be deemed a “Primary Liquidity
Facility” under the Operative Agreements, unless and until (A) each of the
conditions referred to in sub-clauses (iv)(w) and (y) below shall have been
satisfied and (B) in the case of a Replacement Primary Liquidity Facility
arranged by a Primary Liquidity Provider under Section 3.6(e)(ii) or
pursuant to Section 3.6(c), such Replacement Primary Liquidity Facility is
acceptable to JetBlue.


 


(iv)          In
connection with the issuance of each Replacement Primary Liquidity Facility,
the Subordination Agent shall (w) prior to the issuance of such
Replacement Primary Liquidity Facility, obtain written confirmation from each
Rating Agency that such Replacement Primary Liquidity Facility will not cause a
reduction of any rating then in effect for any Class of Certificates by such
Rating Agency (without regard to any downgrading of any rating of any Primary Liquidity
Provider being replaced pursuant to Section 3.6(c) hereof and without
regard to the Policies) and, in the case of the Class G-1 Primary
Liquidity Facility or Class G-2 Primary Liquidity Facility


 


47

















 


 


only,
the written consent of the Policy Provider (which consent shall not be
unreasonably withheld or delayed), (x) pay all Liquidity Obligations then
owing to the replaced Primary Liquidity Provider (which payment shall be made
first from available funds in the applicable Primary Cash Collateral Account as
described in clause (vii) of Section 3.6(f) hereof, and thereafter from
any other available source, including, without limitation, a drawing under the
Replacement Primary Liquidity Facility), (y) cause the issuer of the
Replacement Primary Liquidity Facility to deliver the Replacement Primary
Liquidity Facility to the Subordination Agent, together with a legal opinion
opining that such Replacement Primary Liquidity Facility is an enforceable
obligation of such Replacement Primary Liquidity Provider and (z) cause
the Primary Liquidity Provider being replaced to return its certified copy of
the related Policy, if any, to the Policy Provider.


 


(v)           Upon
satisfaction of the conditions set forth in clauses (iii) and (iv) of this
Section 3.6(e) with respect to a Replacement Primary Liquidity Facility,
(w) the replaced Primary Liquidity Facility shall terminate, (x) the
Subordination Agent shall, if and to the extent so requested by JetBlue or the
Primary Liquidity Provider being replaced, execute and deliver any certificate
or other instrument required in order to terminate the replaced Primary
Liquidity Facility, shall surrender the replaced Primary Liquidity Facility to
the Primary Liquidity Provider being replaced and shall execute and deliver the
Replacement Primary Liquidity Facility and any associated Fee Letter,
(y) each of the parties hereto shall enter into any amendments to this
Agreement necessary to give effect to (1) the replacement of the applicable
Primary Liquidity Provider with the applicable Replacement Primary Liquidity
Provider and (2) the replacement of the applicable Primary Liquidity
Facility with the applicable Replacement Primary Liquidity Facility and
(z) the applicable Replacement Primary Liquidity Provider shall be deemed
to be a Primary Liquidity Provider with the rights and obligations of a Primary
Liquidity Provider hereunder and under the other Operative Agreements and such
Replacement Primary Liquidity Facility shall be deemed to be a Primary
Liquidity Facility hereunder and under the other Operative Agreements.


 


(f)            Cash Collateral Accounts;
Above-Cap Account Withdrawals; Withdrawals; Investments.  In the event the Subordination Agent shall
draw all available amounts under the Class G-1 Primary Liquidity Facility,
the Class G-2 Primary Liquidity Facility or the Class C Primary
Liquidity Facility pursuant to Section 3.6(c), 3.6(d), 3.6(i) or 3.6(k)
hereof, or in the event amounts are to be deposited in the Class G-1
Primary Cash Collateral Account, Class G-2 Primary Cash Collateral Account
or the Class C Primary Cash Collateral Account pursuant to subclause (A)
or (B) of clause “fourth” of Section 3.2, amounts so drawn or to be
deposited, as the case may be, shall be deposited by the Subordination Agent in
the Class G-1 Primary Cash Collateral Account, Class G-2 Primary Cash
Collateral Account or the Class C Primary Cash Collateral Account,
respectively.  If the Class G-1
Above-Cap Liquidity Provider, Class G-2 Above-Cap Liquidity Provider or
Class C Above-Cap Liquidity Provider shall at any time make a Termination
Amount payment under the related Above-Cap Liquidity Facility, such Termination
Amount payment shall be deposited by the Subordination Agent in the related
Above-Cap Reserve Account to be applied as specified below in this
Section 3.6(f).  All amounts on
deposit in each Cash Collateral Account shall be invested and reinvested in
Eligible Investments in accordance with Section 2.2(b) hereof.


 


48

















 


On each Interest
Payment Date (or, in the case of any Special Distribution Date occurring as
contemplated in Section 2.4(a) hereof (a “Special Payment Withdrawal”), on such Special Distribution
Date), Investment Earnings on amounts on deposit in each Primary Cash
Collateral Account (or, in the case of any Special Payment Withdrawal resulting
from the redemption, purchase or prepayment of any Equipment Note prior to the
occurrence of a payment default under any Indenture, a fraction of such Investment
Earnings equal to the Section 2.4(a) Fraction) shall be deposited in the
Collection Account (or, in the case of any Special Payment Withdrawal, the
Special Payments Account) and applied on such Interest Payment Date (or Special
Distribution Date, as the case may be) in accordance with Section 2.4, 3.2
or 3.4 (as applicable).  Investment
Earnings on amounts on deposit in each Above-Cap Reserve Account shall be
credited to such account and applied in the same manner as the Termination
Amount payment credited thereto. 
Investment Earnings on amounts on deposit in each Above-Cap Account
shall be credited to such account and applied in the same manner as Above-Cap
Payments credited thereto.  The
Subordination Agent shall deliver a written statement to JetBlue, the Policy
Provider and the Liquidity Providers, one day prior to each Interest Payment
Date and Special Distribution Date setting forth the aggregate amount of
Investment Earnings held in each of the Cash Collateral Accounts as of such
date.  The Subordination Agent shall
also deliver a written statement to JetBlue, the Policy Provider and the
Above-Cap Liquidity Providers one day after each Distribution Date on which
amounts have been deposited in an Above-Cap Account and/or deposited in or
withdrawn from an Above-Cap Reserve Account setting forth the amount of such
deposit and/or withdrawal.  In addition,
from and after the date funds are so deposited, the Subordination Agent shall
make withdrawals from such account as follows (provided that the Individual
Drawn Percentage of any withdrawal specified in clause (i)(A), (ii)(A) or
(iii)(A) below, together with the sum of (x) the Individual Drawn
Percentages of unreimbursed withdrawals under clause (i)(A), (ii)(A) or
(iii)(A), respectively, and (y) the Individual Drawn Percentages of any
unreimbursed Interest Drawing made under the related Primary Liquidity
Facility, shall not exceed one hundred percent):


 


(i)            on
each Distribution Date, the Subordination Agent shall, to the extent it shall
not have received funds to pay accrued and unpaid interest due and owing on the
Class G-1 Certificates (at the Stated Interest Rate for the Class G-1
Certificates) after giving effect to the subordination provisions of this
Agreement and any Election Interest Payment made by the Policy Provider,
(A) withdraw from the Class G-1 Primary Cash Collateral Account, and
pay to the Class G-1 Trustee, an amount equal to the lesser of (x) an
amount necessary to pay accrued and unpaid interest (at the Stated Interest
Rate for the Class G-1 Certificates) on such Class G-1 Certificates
and (y) the amount on deposit in the Class G-1 Primary Cash
Collateral Account, (B) withdraw from the Class G-1 Primary Cash
Collateral Account and deposit in the Collection Account for application on such
Distribution Date in accordance with clauses “fourth” through “sixteenth” of
Section 3.2 hereof an amount equal to the lesser of (x) the excess,
if any, of (i) the amount of interest that would have been withdrawn under
clause (A)(x) above on such Distribution Date if interest was calculated
at the Capped Interest Rate for the Class G-1 Certificates over
(ii) the actual amount withdrawn under clause (A)(x) above on such
Distribution Date (at the Stated Interest Rate for the Class G-1 Certificates)
and (y) the amount on deposit in the Class G-1 Primary Cash
Collateral Account and (C) if an “Above-Cap Payment” would have been
required to be made on such Distribution Date pursuant to the terms of the
Class G-1 Above-Cap Liquidity Facility were such Liquidity


 


49

















 


Facility
still in effect, withdraw from the Class G-1 Above-Cap Reserve Account and
deposit in the Class G-1 Above-Cap Account, an amount (if any) equal to the
lesser of (x) an amount equal to such Above-Cap Payment and (y) the
amount on deposit in the Class G-1 Above-Cap Reserve Account;


 


(ii)           on
each Distribution Date, the Subordination Agent shall, to the extent it shall
not have received funds to pay accrued and unpaid interest due and owing on the
Class G-2 Certificates (at the Stated Interest Rate for the Class G-2
Certificates) after giving effect to the subordination provisions of this
Agreement and any Election Interest Payment made by the Policy Provider,
(A) withdraw from the Class G-2 Primary Cash Collateral Account, and
pay to the Class G-2 Trustee, an amount equal to the lesser of (x) an
amount necessary to pay accrued and unpaid interest (at the Stated Interest
Rate for the Class G-2 Certificates) on such Class G-2 Certificates
and (y) the amount on deposit in the Class G-2 Primary Cash
Collateral Account, (B) withdraw from the Class G-2 Primary Cash
Collateral Account and deposit in the Collection Account for application on
such Distribution Date in accordance with clauses “fourth” through “sixteenth”
of Section 3.2 hereof (as applicable), an amount equal to the lesser of
(x) the excess, if any, of (i) the amount of interest that would have
been withdrawn under clause (A)(x) above on such Distribution Date if interest
was calculated at the Capped Interest Rate for the Class G-2 Certificates
over (ii) the actual amount withdrawn under clause (A)(x) above on such
Distribution Date (at the Stated Interest Rate for the Class G-2
Certificates) and (y) the amount on deposit in the Class G-2 Primary
Cash Collateral Account and (C) if an “Above-Cap Payment” would have been
required to be made on such Distribution Date pursuant to the terms of the
Class G-2 Above-Cap Liquidity Facility were such Liquidity Facility still
in effect, withdraw from the Class G-2 Above-Cap Reserve Account and
deposit in the Class G-2 Above-Cap Account, an amount (if any) equal to the
lesser of (x) an amount equal to such Above-Cap Payment and (y) the
amount on deposit in the Class G-2 Above-Cap Reserve Account;


 


(iii)          on
each Distribution Date, the Subordination Agent shall, to the extent it shall
not have received funds to pay Adjusted Interest due and owing on the
Class C Certificates (at the Stated Interest Rate for the Class C
Certificates) from after giving effect to the subordination provisions of this
Agreement, (A) withdraw from the Class C Primary Cash Collateral
Account, and pay to the Class C Trustee, an amount equal to the lesser of
(x) an amount necessary to pay Adjusted Interest (at the Stated Interest
Rate for the Class C Certificates) on such Class C Certificates and
(y) the amount on deposit in the Class C Primary Cash Collateral
Account, (B) withdraw from the Class C Primary Cash Collateral Account and
deposit in the Collection Account for application on such Distribution Date in
accordance with clauses “fourth” through “sixteenth” of Section 3.2 hereof
(as applicable), an amount equal to the lesser of (x) the excess, if any,
of (i) the amount of Adjusted Interest that would have been withdrawn
under Clause (A)(x) above on such Distribution Date if interest was calculated
at the Capped Interest Rate for the Class C Certificates over (ii) the
Adjusted Interest actually withdrawn under clause (A)(x) above on such
Distribution Date (at the Stated Interest Rate for the Class C Certificates)
and (y) the amount on deposit in the Class C Primary Cash Collateral
Account, and (C) if an “Above-Cap Payment” would have been required to be
made on such Distribution Date pursuant to the terms of the Class C Above-Cap


 


50

















 


Liquidity
Facility were such Liquidity Facility still in effect, withdraw from the
Class C Above-Cap Reserve Account and deposit in the Class C Above-Cap
Account, an amount (if any) equal to the lesser of (x) an amount equal to
such Above-Cap Payment and (y) the amount on deposit in the Class C
Above-Cap Reserve Account;


 


(iv)          on
each date on which the Pool Balance of the Class G-1 Trust shall have been
reduced by payments made to the Class G-1 Certificateholders pursuant to
Section 2.4 or 3.2 hereof or pursuant to Section 2.03 of the Escrow
and Paying Agent Agreement for such Class, the Subordination Agent shall
withdraw from the Class G-1 Primary Cash Collateral Account such amount as
is necessary so that, after giving effect to the reduction of the Pool Balance
on such date and any transfer of Investment Earnings from such Primary Cash
Collateral Account to the Collection Account or the Special Payments Account on
such date, an amount equal to the sum of the Required Amount (with respect to
the Class G-1 Primary Liquidity Facility) plus (if on a Special
Distribution Date not coinciding with an Interest Payment Date) Investment
Earnings on deposit in such Primary Cash Collateral Account will be on deposit
in the Class G-1 Primary Cash Collateral Account and shall first, pay such
withdrawn amount to the Class G-1 Primary Liquidity Provider until the
Liquidity Obligations (with respect to the Class G-1 Certificates) owing
to such Primary Liquidity Provider shall have been paid in full, and second,
deposit any remaining withdrawn amount in the Collection Account;


 


(v)           on
each date on which the Pool Balance of the Class G-2 Trust shall have been
reduced by payments made to the Class G-2 Certificateholders pursuant to Section 2.4
or 3.2 hereof or pursuant to Section 2.03 of the Escrow and Paying Agent
Agreement for such Class, the Subordination Agent shall withdraw from the
Class G-2 Primary Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Pool Balance on such date and
any transfer of Investment Earnings from such Primary Cash Collateral Account
to the Collection Account or the Special Payments Account on such date, an
amount equal to the sum of the Required Amount (with respect to the
Class G-2 Primary Liquidity Facility) plus (if on a Special Distribution
Date not coinciding with an Interest Payment Date) Investment Earnings on
deposit in such Primary Cash Collateral Account will be on deposit in the Class G-2
Primary Cash Collateral Account and shall first, pay such withdrawn amount to
the Class G-2 Primary Liquidity Provider until the Liquidity Obligations
(with respect to the Class G-2 Certificates) owing to such Primary
Liquidity Provider shall have been paid in full, and second, deposit any
remaining withdrawn amount in the Collection Account;


 


(vi)          on
each date on which the Preferred C Pool Balance with respect to the
Class C Trust shall have been reduced as a result of payments made to the
Class C Certificateholders pursuant to Section 2.4 or 3.2 hereof or
pursuant to Section 2.03 of the Escrow and Paying Agent Agreement for such
Class or otherwise, the Subordination Agent shall withdraw from the
Class C Primary Cash Collateral Account such amount as is necessary so
that, after giving effect to the reduction of the Preferred C Pool Balance
on such date and any transfer of Investment Earnings from such Primary Cash
Collateral Account to the Collection Account or the Special Payments Account on
such date, an amount equal to the sum of the Required Amount (with respect to
the Class C Primary Liquidity Facility) plus (if such date is a Special
Distribution Date not coinciding with an


 


51

















 


Interest
Payment Date) Investment Earnings on deposit in such Primary Cash Collateral
Account will be on deposit in the Class C Primary Cash Collateral Account
and shall first, pay such withdrawn amount to the Class C Primary
Liquidity Provider until the Liquidity Obligations (with respect to the
Class C Certificates) owing to such Primary Liquidity Provider shall have
been paid in full, and second, deposit any remaining withdrawn amount in the
Collection Account;


 


(vii)         if
a Replacement Primary Liquidity Facility for any Class of Certificates shall be
delivered to the Subordination Agent following the date on which funds have
been deposited into the Primary Cash Collateral Account for such Class of
Certificates, the Subordination Agent shall withdraw all amounts on deposit in
such Primary Cash Collateral Account and shall pay such amounts to the replaced
Primary Liquidity Provider until all Liquidity Obligations owed to such Person
shall have been paid in full, and shall deposit any remaining amount in the
Collection Account; and


 


(viii)        (A) following
(i) the payment of Final Distributions with respect to any Class of
Certificates or (ii) the reduction of the Preferred C Pool Balance to zero
or (iii) the Final Legal Distribution Date for any Class of Certificates,
on the date on which the Subordination Agent shall have been notified by the
Primary Liquidity Provider for such Class of Certificates that the Liquidity
Obligations owed to such Primary Liquidity Provider have been paid in full, or,
if earlier, the first Business Day occurring immediately after the Final Legal
Distribution Date for such Class of Certificates the Subordination Agent shall
withdraw all amounts on deposit in the Primary Cash Collateral Account in
respect of such Class of Certificates and shall deposit such amount in the
Collection Account for distribution in accordance with Section 3.2
(without replenishment of such Primary Cash Collateral Account), and
(B) on the first Business Day occurring immediately after the earlier of
(i) the date of the payment of the Final Distribution with respect to any
Class of Certificates and (ii) the Final Legal Distribution Date with
respect to such Class of Certificates (after giving effect to all distributions
to be made on such date), the Subordination Agent shall pay to the Above-Cap
Liquidity Provider for such Class of Certificates in which either payment of
the Final Distribution or the Final Legal Distribution Date has occurred an
amount equal to the sum of the amounts (if any) on deposit in the Above-Cap
Account and the Above-Cap Reserve Account for such Class of Certificates by
wire transfer of funds to the account identified by the Above-Cap Liquidity
Provider in writing to the Subordination Agent.


 


(g)           Reinstatement.  With respect to any Interest Drawing under
any Primary Liquidity Facility, upon the reimbursement by the Subordination
Agent of the applicable Primary Liquidity Provider for all or part of the
amount of such Interest Drawing, together with any accrued interest thereon,
the Available Amount of such Primary Liquidity Facility shall be recalculated
and reinstated by an amount equal to the product of (i) the then Required
Amount (calculated as if no Interest Drawing is outstanding), and (ii) a
fraction, the numerator of which is the amount of such reimbursement (assuming
that Interest Drawings are reimbursed in the order in which they were made) in
respect of principal of such Interest Drawing and the denominator of which is
the Required Amount at the date of such Interest Drawing (calculated as if no
Interest Drawing was then outstanding and on the basis of the lower of the
applicable Stated Interest Rate and the applicable Capped Interest Rate as of
such date) but not to exceed the Stated Amount for


 


52

















 


such Primary Liquidity Facility; provided, however,
that such Primary Liquidity Facility shall not be so reinstated in part or in
full at any time if (x) both a Performing Note Deficiency exists and a
Liquidity Event of Default shall have occurred and be continuing with respect
to the relevant Liquidity Facility or (y) a Final Drawing, Downgrade
Drawing, Non-Extension Drawing or a Special Termination Drawing shall have
occurred with respect to such Primary Liquidity Facility; provided, further,
that any payment by the Policy Provider to a Primary Liquidity Provider of any
amounts pursuant to the proviso of Section 2.6(c) shall not reinstate the
related Primary Liquidity Facility, but such Primary Liquidity Facility (so
long as it is in effect) shall be reinstated, pro tanto by an amount equal to
the product of (i) the then Required Amount (calculated as if no Interest
Drawing is outstanding), and (ii) a fraction, the numerator of which is the
amount of such reimbursement (assuming that Interest Drawings are reimbursed in
the order in which they were made) in respect of principal of such Interest
Drawing and the denominator of which is the Required Amount at the date of such
Interest Drawing (calculated as if no Interest Drawing was then outstanding and
on the basis of the lower of the applicable Stated Interest Rate and the
applicable Capped Interest Rate as of such date), to the extent the Policy
Provider receives any reimbursement in respect of such payment under clause
“fourth” of Section 3.2, unless (x) both a Performing Note Deficiency
exists and a Liquidity Event of Default shall have occurred with respect to
such Primary Liquidity Facility or (y) a Final Drawing, Downgrade Drawing,
Non-Extension Drawing or a Special Termination Drawing shall have occurred with
respect to such Primary Liquidity Facility. 
In the event that, with respect to any particular Primary Liquidity
Facility, (i) funds are withdrawn from any Primary Cash Collateral Account
pursuant to clause (i), (ii) or (iii) of Section 3.6(f) hereof
or (ii) such Primary Liquidity Facility shall become a Downgraded Facility
or a Non-Extended Facility at a time when unreimbursed Interest Drawings under
such Primary Liquidity Facility have reduced the Available Amount thereunder to
zero, then funds received by the Subordination Agent at any time other than
(x) any time when a Liquidity Event of Default shall have occurred and be
continuing with respect to such Primary Liquidity Facility and a Performing
Note Deficiency exists or (y) any time after a Final Drawing shall have
occurred with respect to such Primary Liquidity Facility shall be deposited in
such Primary Cash Collateral Account as and to the extent provided in clause
“fourth” of Section 3.2 and applied in accordance with Section 3.6(f)
hereof.


 


(h)           Reimbursement.  The amount of each drawing under the Primary
Liquidity Facilities shall be due and payable, together with interest thereon,
on the dates and at the rates, respectively, provided in the Primary Liquidity
Facilities.  The Subordination Agent
shall have no obligation to reimburse the Above-Cap Liquidity Providers for any
Above-Cap Payments and the Above-Cap Liquidity Providers shall have no interest
in any monies credited to any Trust Account except as provided in
Section 3.6(f)(viii) hereof.


 


(i)            Final Drawing.  Upon receipt from a Primary Liquidity
Provider of a Termination Notice with respect to any Primary Liquidity
Facility, the Subordination Agent shall, not later than the date specified in
such Termination Notice, in accordance with the terms of such Primary Liquidity
Facility, request a drawing under such Primary Liquidity Facility of all
available and undrawn amounts thereunder (a “Final
Drawing”).  Amounts drawn
pursuant to a Final Drawing shall be maintained and invested in accordance with
Section 3.6(f) hereof.


 


(j)            Reduction of Stated Amount.  Promptly following each date on which the
Required Amount of the Primary Liquidity Facility for a Class of Certificates
is reduced as a


 


53

















 


result of (i) a reduction in the Pool Balance
with respect to such Certificates (including by reason of Policy Provider
Election) or (ii) with respect to the Primary Liquidity Facility for the
Class C Certificates, a reduction of the Preferred C Pool Balance, the Stated Amount
of such Primary Liquidity Facility shall be automatically reduced to an amount
equal to the Required Amount with respect to such Primary Liquidity Facility
(as calculated by the Subordination Agent after giving effect to such payment).


 


(k)           Special Termination Drawing.  Upon receipt from a Primary Liquidity
Provider of a Special Termination Notice with respect to any Primary Liquidity
Facility, the Subordination Agent shall, not later than the date specified in
such Special Termination Notice, in accordance with the terms of such Primary
Liquidity Facility, request a drawing under such Primary Liquidity Facility of
all available and undrawn amounts thereunder (a “Special Termination Drawing”).  Amounts drawn pursuant to a Special Termination Drawing shall be
maintained and invested in accordance with Section 3.6(f) hereof.


 


(l)            Relation to Subordination
Provisions.  Interest Drawings under
the Primary Liquidity Facilities and withdrawals from the Cash Collateral
Accounts and the Above-Cap Accounts, in each case, in respect of interest on
the Certificates of any Class, will be distributed to the Trustee for such
Class of Certificates for distribution to Certificateholders of the related
Class, notwithstanding Sections 3.2 and 3.6(h) hereof.


 


(m)          Assignment of the Primary Liquidity
Facility.  The Subordination Agent
agrees not to consent to the assignment by any Primary Liquidity Provider of
any of its rights or obligations under any Primary Liquidity Facility or any
interest therein, unless (i) JetBlue shall have consented to such
assignment, such consent to be within JetBlue’s sole discretion, (ii) each
Rating Agency shall have provided a Ratings Confirmation in respect of such
assignment and (iii) in the case of the Class G-1 Primary Liquidity
Facility and Class G-2 Primary Liquidity Facility only, the Policy
Provider shall have consented to such assignment (which consent shall not be
unreasonably withheld or delayed), and, upon the satisfaction of the foregoing
clauses (i), (ii) and (iii) (if applicable) and the provisions of
Section 3.6(e)(iv), the Subordination Agent shall give such consent and
the foregoing is not intended to and shall not be construed to limit the rights
of the Primary Liquidity Provider under Section 3.6(e).


 


Section 3.7.            The Policies.  The following provisions of paragraphs (a)
through (h) of this Section 3.7 shall apply to (i) the Class G-1
Trust and the Class G-1 Certificates and (ii) the Class G-2
Trust and the Class G-2 Certificates, as if such provisions are separately
set forth in full for each of the Class G-1 Trust (and the Class G-1
Certificates) and the Class G-2 Trust (and the Class G-2
Certificates).  For the purposes of
clause (i) above, each reference in paragraphs (a) through (h) of this
Section 3.7 to “Above-Cap Account,” “Accrued Class G Interest,”
“Class G Primary Cash Collateral Account,” “Class G Certificates,”
“Class G Certificateholders,” “Class G Deposits,” “Class G
Escrow Receipts,” Class G Primary Liquidity Facility,” “Class G
Paying Agent Account,” “Class G Trust,” “Class G Trustee,” “Policy,”
“Policy Account” and “Series G Equipment Note” shall mean “Class G-1 Above-Cap
Account,” “Accrued Class G-1 Interest,” “Class G-1 Primary Cash
Collateral Account,” “Class G-1 Certificates,” “Class G-1
Certificateholders,” “Class G-1 Deposits,” “Class G-1 Escrow
Receipts,” “Class G-1 Primary Liquidity Facility,” “Class G-1 Paying
Agent Account,” “Class G-1 Trust,” “Class G-1 Trustee,”
“Class G-1 Policy,” “Class G-1 Policy Account” and


 


54

















 


“Series G-1 Equipment Note,” respectively.  For the purposes of clause (ii) above, each
reference in paragraphs (a) through (h) of this Section 3.7 to “Above-Cap
Account,” “Accrued Class G Interest,” “Class G Cash Collateral
Account,” “Class G Certificates,” “Class G Certificateholders,”
“Class G Deposits,” “Class G Primary Liquidity Facility,”
“Class G Paying Agent Account,” “Class G Trustee,” “Policy,” “Policy
Account” and “Series G Equipment Note” shall mean “Class G-2 Above-Cap
Account,” “Accrued Class G-2 Interest,” “Class G-2 Primary Cash
Collateral Account,” “Class G-2 Certificates,” “Class G-2
Certificateholders,” “Class G-2 Deposits,” “Class G-2 Escrow Receipts,”
“Class G-2 Primary Liquidity Facility,” “Class G-2 Paying Agent
Account,” “Class G-2 Trust,” “Class G-2 Trustee,” “Class G-2
Policy,” “Class G-2 Policy Account” and “Series G-2 Equipment Note,”
respectively.”


 


(a)           Interest Drawings.  If on any Regular Distribution Date (other
than the Final Legal Distribution Date) after giving effect to the application
of available funds in accordance with the subordination provisions of this
Agreement and to the application of Prior Funds, the Subordination Agent does
not then have sufficient funds available for the payment of all amounts due and
owing in respect of accrued and unpaid interest on the Class G
Certificates at the Stated Interest Rate on the Pool Balance of the
Class G Certificates on such Distribution Date (“Accrued Class G Interest”), then the
Subordination Agent (i) prior to 1:00 p.m. (New York City time) on
such Distribution Date shall deliver a Notice for Payment, as provided in the
Policy, to the Policy Provider or its fiscal agent, requesting a Policy Drawing
under the Policy (for payment into the Policy Account) in an amount sufficient
to enable the Subordination Agent to pay such Accrued Class G Interest and
(ii) upon receipt shall pay such amount from the Policy Account to the
Class G Trustee or the Escrow Agent for deposit to the Class G Paying
Agent Account, as the case may be, in payment of such Accrued Class G
Interest on such Distribution Date.


 


(b)           Proceeds Deficiency Drawing.  If on any Special Distribution Date (which
is not also an Election Distribution Date or a Special Distribution Date
established pursuant to the second paragraph of Section 3.7(c))
established by the Subordination Agent by reason of its receipt of a Special
Payment (other than a Special Payment arising from the purchase of any Series G
Equipment Notes by any or all of the Class C Certificateholders pursuant to
Section 2.7 of this Agreement) constituting the proceeds of any Series G
Equipment Note (as to which there has been a default in the payment of
principal thereof or that has been Accelerated) or related Collateral (a “Disposition  Payment”) and if on such Special Distribution Date after
giving effect to the application of available funds (including, without
limitation, the amount of such Disposition Payment) in accordance with the
subordination provisions of this Agreement and to the application of Prior
Funds, the Subordination Agent does not then have sufficient funds available
for a reduction in the outstanding Pool Balance of the Class G
Certificates by an amount equal to the outstanding principal amount of such
Series G Equipment Note (determined immediately prior to the receipt of such
proceeds and less any Policy Drawing previously paid by the Policy Provider in
respect of principal of such Series G Equipment Note) plus accrued and unpaid
interest on the amount of such reduction at the Stated Interest Rate for the
Class G Certificates for the period from the immediately preceding Regular
Distribution Date to such Special Distribution Date, then the Subordination
Agent (i) prior to 1:00 p.m. (New York City time) on such Special
Distribution Date shall deliver a Notice for Payment, as provided in the Policy
(for payment into the Policy Account) in an amount sufficient to enable the
Subordination Agent to pay the amount of such reduction plus such accrued and
unpaid interest on the amount


 


55

















 


of such reduction and (ii) upon receipt shall pay
such amount from the Policy Account to the Class G Trustee in payment of
such reduction in the outstanding Pool Balance of the Class G Certificates
plus such accrued interest on the amount of such reduction on such Special
Distribution Date; provided, however, that, notwithstanding
anything to the contrary herein, the purchase of any Series G Equipment Notes
by any or all of the Class C Certificateholders pursuant to Section 2.7
hereof shall not result in an amount that is payable by the Policy Provider
under this Section 3.7(b) regardless of whether or not the proceeds of
such purchase, together with any other available funds, are sufficient to reduce
the Pool Balance of the Class G Certificates by an amount equal to the
outstanding principal amount of such Series G Equipment Notes (determined
immediately prior to the receipt of such proceeds and less the amount of any
drawings previously paid by the Policy Provider in respect of principal on such
Series G Equipment Notes) plus accrued and unpaid interest on the amount of
such reduction at the Stated Interest Rate for the Class G Certificates from
the period from the immediately preceding Regular Distribution Date to such
Special Distribution Date.  The
Subordination Agent shall promptly, but no less than 25 days prior to the
Special Distribution Date established pursuant to this Section 3.7(b),
send to JetBlue, the Trustees, the Liquidity Provider for the Class G Liquidity
Facility and the Policy Provider, a written notice of such Special Distribution
Date.


 


(c)           No Proceeds Drawing.  If the Subordination Agent or the Class G
Trustee, as the case may be, has not received a Special Payment constituting
proceeds from the sale of a Series G Equipment Note or the related Collateral
(including, without limitation, proceeds received in connection with the
purchase by any or all of the Class C Certificateholders of any Series G
Equipment Note pursuant to Section 2.7 of this Agreement) (a “Disposition”), as the case may be, during
the 21-month period beginning on the last date on which any payment was made in
full on such Series G Equipment Note (the date of such payment in full, the “Last Payment Date”) as to which there has
been a failure to pay principal or that has been Accelerated subsequent to the
Last Payment Date, then on the first Business Day following the expiration of
such 21-month period, the Subordination Agent shall deliver a Notice for
Payment, as provided in the Policy, to the Policy Provider or its fiscal agent,
requesting a Policy Drawing under the Policy (for payment into the Policy
Account) in an amount equal to the then outstanding principal amount of such
Equipment Note plus accrued and unpaid interest thereon at the Stated Interest
Rate for the Class G Certificates from the immediately preceding Regular
Distribution Date to the below referred to Special Distribution Date.  The Subordination Agent shall promptly, but
not less than 25 days prior to such Business Day, send to the Class G
Trustee, JetBlue, the Liquidity Provider and the Policy Provider a Written
Notice setting forth the non-receipt of any such Special Payment and
establishing such Business Day as the date for the distribution of the proceeds
of such Policy Drawing, which date shall constitute a Special Distribution
Date.  No later than 1:00 p.m. (New
York City time) on the specified Special Distribution Date the Subordination
Agent shall make the specified Policy Drawing and upon its receipt of the
proceeds thereof pay the amount thereof from the Policy Account to the
Class G Trustee in reduction of the outstanding Pool Balance of the
Class G Certificates together with such accrued and unpaid interest
thereon.  For the avoidance of doubt,
after the payment in full of such amount under this Section 3.7(c), the
Subordination Agent shall have no right to make any further Policy Drawings
under this Section 3.7(c) in respect of any Disposition of or in respect
of such Equipment Note except for Preference Amounts as provided in
Section 3.7(e).


 


56

















 


Notwithstanding
the foregoing, the Policy Provider, has the right at the end of any such
21-month period, so long as no Policy Provider Default shall have occurred and
be continuing, by giving notice to the Subordination Agent at least five days
prior to the end of such 21-month period, to elect (the “Policy Provider Election”) instead
(A) to pay on such Special Distribution Date an amount equal to any shortfall
in the scheduled principal and interest payable but not paid on such Series G
Equipment Note (without regard to the Acceleration thereof) during such
21-month period (after giving effect to the application of funds received from
the Class G Primary Liquidity Facility, the Class G Primary Cash
Collateral Account and the Above-Cap Account, in each case attributable to such
interest determined on a consistent basis), (B) thereafter, on each
Regular Distribution Date until the establishment of an Election Distribution
Date or a Special Distribution Date referred to in clause (C)(i) below, to
permit drawings under the Policy for an amount equal to the scheduled principal
(without regard to any acceleration thereof) and interest payments (without
regard to any funds available under any Liquidity Facility or any Cash
Collateral Account or the Above-Cap Account) at the Stated Interest Rate for
the Class G Certificates payable on such Equipment Note on the related
payment date (each such interest payment, an “Election
Interest Payment”) and (C) (i) on any Business Day (which
shall be a Special Distribution Date) elected by the Policy Provider upon 20
days’ Written Notice to the Subordination Agent and the Class G Trustee to
request the Subordination Agent, or (ii) following either the occurrence
and continuation of a Policy Provider Default on any Business Day (which shall
be a Special Distribution Date) specified by the Subordination Agent upon 20
days’ Written Notice to the Class G Trustee (each such Business Day in the
case of clause (ii) an “Election Distribution
Date”) to permit the Subordination Agent, in each case, to make a
Policy Drawing for an amount equal to the then outstanding principal balance of
such Equipment Note less any Policy Drawings previously paid by the Policy
Provider in respect of principal of such Equipment Note and accrued and unpaid
interest on such amounts at the Stated Interest Rate for the Class G
Certificates from the immediately preceding Regular Distribution Date to such
Election Distribution Date or such Special Distribution Date, as the case may
be.  The Subordination Agent shall make
each such drawing referred to in this paragraph under the Policy (for payment
into the Policy Account) no later than 1:00 p.m. (New York City time) on
each such date and upon its receipt of the proceeds thereof pay the amount
thereof from the Policy Account to the Class G Trustee in reduction of the
outstanding Pool Balance of the Class G Certificates together with such
accrued and unpaid interest thereon.


 


In addition,
regardless of whether or not the Policy Provider makes a Policy Provider
Election, the Policy Provider shall, at the end of such 21-month period described in Section 3.7(c), endorse the
Policy (if not already endorsed to so provide) to provide for the payment to
the Primary Liquidity Provider
with respect to the Class G Certificates of interest accruing on the
outstanding drawings in respect of the Primary Liquidity Facility from and after the end of such 21-month period as and
when such interest becomes due in accordance with the Primary Liquidity Facility (“Excess Interest Policy Drawings”).  The Policy Provider hereby agrees not to
otherwise amend or modify the Policy without the consent of the Primary Liquidity Provider if such amendment or
modification would adversely affect the rights of the Primary Liquidity Provider.


 


(d)           Final Policy Drawing.  If on the Final Legal Distribution Date of
the Class G Certificates after giving effect to the distribution of
available funds in accordance with


 


57

















 


the subordination provisions of this Agreement and to
the application of Prior Funds, the Subordination Agent does not then have
sufficient funds available on such date for the payment in full of the Final
Distributions (calculated as of such date but excluding any accrued and unpaid
Additional Payments or other premium) on the Class G Certificates then the
Subordination Agent shall (i) prior to 1:00 p.m. (New York City time)
on such date deliver a Notice for Payment, as provided in the Policy, to the
Policy Provider or its fiscal agent, requesting a Policy Drawing under the
Policy (for payment into the Policy Account) in an amount equal to the minimum
amount sufficient to enable the Subordination Agent to pay the Final
Distributions (calculated as of such date but excluding any accrued and unpaid
premium) on the Class G Certificates, and (ii) upon receipt pay such
amount from the Policy Account to the Class G Trustee in payment of such
amount on such date.


 


If on the Final
Withdrawal Date (as defined in the Escrow and Paying Agent Agreement for the
Class G Certificates) the full amount of the Class G Deposits has not
been used to purchase the Class G Equipment Notes and there is a shortfall
in the amount available to the Paying Agent for the payment in full of the
unpaid principal amount of the Class G Escrow Receipts then, prior to
1:00 p.m. (New York City time) on such date, the Subordination Agent
shall: (i) deliver a Notice of Nonpayment, as provided in the Policy, to
the Policy Provider or its fiscal agent, requesting a Policy Drawing under the
Policy (for payment into the Policy Account) in an amount equal to the amount
of such shortfall and (ii) shall pay such amount from the Policy Account
to the Paying Agent for the Class G Trust in payment of such amount on
such date.


 


(e)           Avoidance Drawings.  If at any time the Subordination Agent shall
have actual knowledge of the issuance of any Order, the Subordination Agent
shall promptly give notice thereof to each Trustee, the Primary Liquidity
Providers and the Policy Provider.  The
Subordination Agent shall thereupon calculate the relevant Preference Amounts
resulting therefrom and shall promptly: 
(a) send to the Class G Trustee a Written Notice of such
amount and (b) prior to the expiration of the Policy, deliver to the
Policy Provider or its fiscal agent a Notice of Avoided Payment, together with
a copy of the documentation required by the Policy with respect thereto,
requesting a Policy Drawing (for payment to the receiver, conservator,
debtor-in-possession or trustee in bankruptcy and/or to the Subordination Agent
for deposit into the Policy Account, as applicable) in an amount equal to the
amount of relevant Preference Amount. 
To the extent that any portion of such Preference Amount is to be paid
to the Subordination Agent, such Written Notice shall also set the date for the
distribution of such portion of the proceeds of such Policy Drawing which date
shall constitute a Special Distribution Date and shall be the earlier of the
third Business Day that immediately precedes the date of the expiration of the
Policy and the Business Day that immediately follows the 25th day after the
date of such Written Notice.  No later
than 1:00 p.m. (New York City time) on the third Business Day prior to the
specified Special Distribution Date, the Subordination Agent shall make the
specified Policy Drawing (as set forth in clause (b) above) and upon its
receipt of any proceeds thereof, pay such amounts from the Policy Account to
the Class G Trustee in reinstatement of the Preference Amount.


 


(f)            Application of Policy Drawings.  Notwithstanding anything to the contrary
contained in this Agreement (including, without limitation, Sections 2.4
and 3.2 hereof), all payments received by the Subordination Agent in respect of
a Policy Drawing (including, without limitation, that portion, if any, of the
proceeds of a Policy Drawing for any Preference


 


58

















 


Amount that is to be paid to the Subordination Agent
and not to any receiver, conservator, debtor-in-possession or trustee in
bankruptcy as provided in the Policy) shall be promptly paid from the
Class G Policy Account to the Class G Trustee for distribution to the
Class G Certificateholders or to the Escrow Agent for distribution to the
holders of the Class G Escrow Receipts, as the case may be; provided,
however, that any Election Interest Payment with respect to one or more
Series G-1 Equipment Notes or Series G-2 Equipment Notes which are for interest
that was previously paid pursuant to Interest Drawings that remain outstanding
under the relevant Liquidity Facility shall be paid directly to the relevant
Primary Liquidity Provider as reimbursement for such Interest Drawing or to the
related Cash Collateral Account as replenishment for such withdrawal, as
applicable, and any Excess Interest Policy Drawings shall be made directly to
the applicable Primary Liquidity Provider.


 


(g)           Limitation to Outstanding Pool
Balance.  Notwithstanding anything
to the contrary in this Section 3.7, except as provided in
Section 3.7(e), at no time shall the Subordination Agent make any Policy
Drawing under clause (b), (c) or (d) of this Section 3.7 in excess of the
then outstanding Pool Balance of the Class G Certificates and accrued and
unpaid interest at the Stated Interest Rate on the Class G
Certificates.  Nothing contained in this
Intercreditor Agreement shall alter or amend the liabilities, obligations,
requirements or procedures of the Policy Provider under the Policy and the
Policy Provider shall not be obligated to make payment except at the times and
in the amounts and under the circumstances expressly set forth in the Policy.


 


(h)           Resubmission of Notice for Payment.  If the Policy Provider at any time informs
the Subordination Agent in accordance with the Policy that a Notice for Payment
or Notice of Avoided Payment submitted by the Subordination Agent does not meet
the requirements of the Policy, the Subordination Agent shall, as promptly as
possible after being so informed, submit to the Policy Provider an amended and
revised Notice for Payment or Notice of Avoided Payment, as the case may be,
and shall pay to the Class G Trustee out of the Policy Account the amount
received pursuant to such amended or revised Notice for Payment or Notice of
Avoided Payment, as the case may be, when received.


 


(i)            Subrogation.  The Policy Provider will be subrogated to
all of the rights of the holders of the Class G Certificates to payment on the
Class G Certificates to the extent of the payments made under the Policy as set
forth herein, the exercise of such subrogation rights to be subject to the
other provisions of this Agreement.


 


ARTICLE IV


 


EXERCISE
OF REMEDIES


 


Section
4.1.            Directions
from the Controlling Party. 
(a) (i) Following the occurrence and during the continuation
of an Indenture Event of Default under any Indenture, the Controlling Party
shall direct the Subordination Agent, which in turn shall direct the Loan
Trustee under such Indenture, in the exercise of remedies available to the
holders of the Equipment Notes issued pursuant to such Indenture, including,
without limitation, the ability to vote all such Equipment Notes in favor of
Accelerating such Equipment Notes in accordance with the provisions of such
Indenture.  Subject to the provisions of
the next paragraph, if the


 


59

















 


Equipment Notes issued pursuant to any Indenture have
been Accelerated following an Indenture Event of Default with respect thereto,
the Controlling Party may direct the Subordination Agent to sell, assign,
contract to sell or otherwise dispose of and deliver all (but not less than
all) of such Equipment Notes to any Person at public or private sale, at any
location at the option of the Controlling Party, all upon such terms and
conditions as it may reasonably deem advisable in accordance with applicable
law.


 


(ii)           Notwithstanding
the foregoing, so long as any Certificates remain Outstanding, during the
period from the occurrence of an Indenture Event of Default and ending on the
date which is nine months after the earlier of (x) the acceleration of the
Equipment Notes under such Indenture or (y) the occurrence of a JetBlue
Bankruptcy Event, without the consent of each Trustee, (A) no Aircraft
subject to the Lien of such Indenture or Equipment Notes issued under such
Indenture may be sold if the net proceeds from such sale would be less than the
Minimum Sale Price for such Aircraft or such Equipment Notes and (B) no
Aircraft subject to the Lien of such Indenture may be leased unless either
(x) the rent payments under such lease are sufficient to pay in full the
scheduled payments of principal and interest on the Equipment Notes issued
under such Indenture that become due during the term of such lease or
(y) the term of such lease (including any renewal option exercisable by
the lessee) does not exceed one year.


 


(iii)          With
respect to any Indenture and subject to Section 4.1(a)(v), upon
(x) the occurrence of a payment default under such Indenture, (y) the
commencement of the exercise of remedies under such Indenture or (z) the
occurrence of a Triggering Event, the Subordination Agent will, unless any such
event described in clauses (x) ceases to be in effect, obtain three
desktop appraisals from the Appraisers selected by the Controlling Party
setting forth the current market value, current lease rate and distress value
of the aircraft (in each case, as defined by ISTAT) subject to such Indenture
(each such appraisal, an “Appraisal”
and the current market value appraisals being referred to herein as the “Post-Default Appraisals”).  For so long as any event set forth in
clauses (x), (y) or (z) above shall be continuing, the Subordination Agent
will obtain updated Appraisals on the date that is 364 days from the date of
the most recent Appraisal and if a JetBlue Bankruptcy Event shall have occurred
and is continuing, on the date that is 180 days from the date of the most
recent Appraisal.


 


(iv)          If
(x) on any Regular Distribution Date the Subordination Agent has
insufficient funds to make the scheduled payments of principal and interest
distributable on the Certificates and (y) a Triggering Event has occurred,
the Subordination Agent will, subject to Section 4.1(a)(v), obtain
Appraisals for each of the Aircraft and shall obtain additional Appraisals
annually thereafter.


 


(v)           After
the Subordination Agent has requested the Appraisers to deliver the initial
Appraisals, the Reserve Account will be funded initially up to the Reserve
Amount from amounts distributed under clause “first” of Section 3.2
hereof.  The Subordination Agent shall
have the right to withdraw funds from the Reserve Account to pay for the
initial and any subsequent Appraisals and the Reserve Account will be
replenished up to the Reserve Amount pursuant to clause “first” of
Section 3.2 hereof; provided, that, except for the initial funding of the
Reserve Account up to the


 


60

















 


Reserve
Amount, no more than $25,000 will be deposited in the Reserve Account in any
calendar year and no more than $75,000 shall be on deposit in the Reserve
Account at any time.


 


(b)           Following the occurrence and during
the continuation of an Indenture Event of Default, the Controlling Party shall
take or shall cause the Subordination Agent to take such actions as it may
reasonably deem most effectual to complete the sale or other disposition of
such Aircraft or Equipment Notes.  In
addition, in lieu of any sale, assignment, contract to sell or other disposition,
the Controlling Party may maintain or cause the Subordination Agent to maintain
possession of such Equipment Notes and continue to apply monies received in
respect of such Equipment Notes in accordance with Article III hereof.  In addition, in lieu of such sale,
assignment, contract to sell or other disposition, or in lieu of such
maintenance of possession, the Controlling Party may, subject to the terms and
conditions of the related Indenture, instruct the Loan Trustee under such
Indenture to foreclose on the Lien on the related Aircraft or to take any other
remedial action permitted under such Indenture or under any applicable law.


 


Section
4.2.            Remedies
Cumulative.  Each and every
right, power and remedy given to the Trustees, the Liquidity Providers, the
Policy Provider, the Controlling Party or the Subordination Agent specifically
or otherwise in this Agreement shall be cumulative and shall be in addition to
every other right, power and remedy herein specifically given or now or
hereafter existing at law, in equity or by statute, and each and every right,
power and remedy whether specifically herein given or otherwise existing may,
subject always to the terms and conditions hereof, be exercised from time to
time and as often and in such order as may be deemed expedient by any Trustee,
any Liquidity Provider, the Policy Provider, the Controlling Party or the
Subordination Agent, as appropriate, and the exercise or the beginning of the
exercise of any power or remedy shall not be construed to be a waiver of the
right to exercise at the same time or thereafter any other right, power or
remedy.  No delay or omission by any
Trustee, any Liquidity Provider, the Policy Provider, the Controlling Party or
the Subordination Agent in the exercise of any right, remedy or power or in the
pursuit of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any default or to be an acquiescence therein.


 


Section 4.3.            Discontinuance
of Proceedings.  In case any
party to this Agreement (including the Controlling Party in such capacity)
shall have instituted any Proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, entry or otherwise, and such Proceeding
shall have been discontinued or abandoned for any reason or shall have been
determined adversely to the Person instituting such Proceeding, then and in
every such case each such party shall, subject to any determination in such
Proceeding, be restored to its former position and rights hereunder, and all rights,
remedies and powers of such party shall continue as if no such Proceeding had
been instituted.


 


Section 4.4.            Right
of Certificateholders to Receive Payments Not to Be Impaired.  Anything in this Agreement to the contrary
notwithstanding but subject to each Trust Agreement, the right of any
Certificateholder, the Primary Liquidity Provider or the Policy Provider,
respectively, to receive payments hereunder (including without limitation
pursuant to Section 2.4 or 3.2 hereof) when due, or to institute suit for
the enforcement of any such payment on or after the applicable Distribution
Date, shall not be impaired or affected without the consent of such
Certificateholder, Primary Liquidity Provider or Policy Provider, respectively.


 


61

















 


Section
4.5.            Undertaking
for Costs.  In any Proceeding
for the enforcement of any right or remedy under this Agreement or in any
Proceeding against any Controlling Party or the Subordination Agent for any
action taken or omitted by it as Controlling Party or Subordination Agent, as
the case may be, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys’ fees and expenses, against any party litigant in the suit, having
due regard to the merits and good faith of the claims or defenses made by the
party litigant.  The provisions of this
Section do not apply to a suit instituted by the Subordination Agent, a
Liquidity Provider, the Policy Provider or a Trustee or a suit by
Certificateholders holding more than 10% of the original principal amount of
any Class of Certificates.


 


ARTICLE V


 


DUTIES
OF THE SUBORDINATION AGENT; AGREEMENTS OF TRUSTEES, ETC.


 


Section
5.1.            Notice
of Indenture Default, Indenture Event of Default or Triggering Event.  (a) In the event the Subordination
Agent shall have actual knowledge of the occurrence of an Indenture Default,
Indenture Event of Default or a Triggering Event, as promptly as practicable,
and in any event within 10 days after obtaining knowledge thereof, the
Subordination Agent shall transmit by mail or courier to the Rating Agencies,
the Liquidity Providers, the Policy Provider and the Trustees notice of such
Indenture Default, Indenture Event of Default or Triggering Event, unless such
Indenture Default, Indenture Event of Default or Triggering Event shall have
been cured or waived by the Controlling Party. 
For all purposes of this Agreement, in the absence of actual knowledge
on the part of a Responsible Officer, the Subordination Agent shall not be
deemed to have knowledge of any Indenture Default, Indenture Event of Default
or Triggering Event unless notified in writing by one or more Trustees, one or
more Liquidity Providers, or the Policy Provider or one or more
Certificateholders.


 


(b)           Other Notices.  The Subordination Agent will furnish to each
Liquidity Provider, the Policy Provider and each Trustee, promptly upon receipt
thereof, duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and other instruments furnished to the
Subordination Agent as registered holder of the Equipment Notes or otherwise in
its capacity as Subordination Agent to the extent the same shall not have been
otherwise directly distributed to such Liquidity Provider, Policy Provider or
Trustee, as applicable, pursuant to the express provision of any other
Operative Agreement.


 


(c)           Upon the occurrence of an Indenture
Event of Default, the Subordination Agent shall instruct the Trustees to, and
the Trustees shall, request that DTC post on its Internet bulletin board a
securities position listing setting forth the names of all the parties
reflected on DTC’s books as holding interests in the certificates.


 


(d)           Reports. Promptly after the
occurrence of a Triggering Event or an Indenture Event of Default resulting
from the failure of JetBlue to make payments on any Equipment Note and on every
Regular Distribution Date while the Triggering Event or such Indenture Event of
Default shall be continuing, the Subordination Agent will provide to the Pass


 


62

















 


Through Trustees, Liquidity Providers, Policy
Provider, Rating Agencies and JetBlue a statement, substantially in the form of
Exhibit A hereto, setting forth the following information:


 


(i)            after
a JetBlue Bankruptcy Event, with respect to each Aircraft, whether such
Aircraft is (A) subject to the 60-day period of Section 1110 of the
Bankruptcy Code, (B) subject to an election by JetBlue under
Section 1110(a) of the Bankruptcy Code; (C) covered by an agreement
contemplated by Section 1110(b) of the Bankruptcy Code or (D) not
subject to any of (A), (B) or (C);


 


(ii)           to
the best of the Subordination Agent’s knowledge, after requesting such
information from JetBlue, (A) whether the Aircraft are currently in
service or parked in storage, (B) the maintenance status of the Aircraft
and (C) location of the Engines (as defined in the Indentures);


 


(iii)          the
current Pool Balance of each Class of Certificates and outstanding principal
amount of all Equipment Notes;


 


(iv)          the
expected amount of interest which will have accrued on the Equipment Notes and
on the Certificates as of the next Regular Distribution Date;


 


(v)           the
amounts paid to each person on such Distribution Date pursuant to this
Agreement;


 


(vi)          details
of the amounts paid on such Distribution Date identified by reference to the
relevant provision of this Agreement and the source of payment (by Aircraft and
party);


 


(vii)         if
any Primary Liquidity Provider has made a Final Advance;


 


(viii)        the
amounts currently owed to any Primary Liquidity Provider;


 


(ix)           the
amounts drawn under each Liquidity Facility by Class;


 


(x)            the
amounts owed to the Policy Provider; and


 


(xi)           after
a JetBlue Bankruptcy Event, any operational reports filed by JetBlue with the
Bankruptcy Court which are available to the Subordination Agent on a
non-confidential basis.


 


Section 5.2.            Indemnification.  The Subordination Agent shall not be
required to take any action or refrain from taking any action under
Article IV hereof unless the Subordination Agent shall have been
indemnified (to the extent and in the manner reasonably satisfactory to the
Subordination Agent) against any liability, cost or expense (including counsel
fees and expenses) which may be incurred in connection therewith.  The Subordination Agent shall not be under
any obligation to take any action under this Agreement and nothing contained in
this Agreement shall require the Subordination Agent to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder or in the exercise of any of its rights or powers if it
shall have reasonable grounds for believing that repayment of such funds or
adequate


 


63

















 


indemnity against such risk or liability is not
reasonably assured to it.  The
Subordination Agent shall not be required to take any action under
Article IV hereof, nor shall any other provision of this Agreement be
deemed to impose a duty on the Subordination Agent to take any action, if the
Subordination Agent shall have been advised by counsel that such action is
contrary to the terms hereof or is otherwise contrary to law.


 


Section
5.3.            No
Duties Except as Specified in Intercreditor Agreement.  The Subordination Agent shall not have any
duty or obligation to take or refrain from taking any action under, or in
connection with, this Agreement, except as expressly provided by the terms of
this Agreement; and no implied duties or obligations shall be read into this
Agreement against the Subordination Agent. 
The Subordination Agent agrees that it will, in its individual capacity
and at its own cost and expense (but without any right of indemnity in respect
of any such cost or expense under Section 7.1 hereof) promptly take such
action as may be necessary to duly discharge all Liens on any of the Trust
Accounts or any monies deposited therein which result from claims against it in
its individual capacity not related to its activities hereunder or any other
Operative Agreement.


 


Section
5.4.            Notice
from the Liquidity Providers and Trustees.  If any Liquidity Provider or any Trustee has notice of an Indenture
Event of Default or a Triggering Event, such Person shall promptly give notice
thereof to all of the other parties hereto, provided, however, that no such
Person shall have any liability hereunder as a result of its failure to deliver
any such notice.


 


Section
5.5.            Agreements
Relating to the Above-Cap Liquidity Facility.  Each of the Subordination Agent and the Trustees agree at the
request of any Above-Cap Liquidity Provider to use reasonable efforts
(consistent with applicable legal and regulatory restrictions) to take any
action that would avoid the need for, or reduce the amount of, any payment
under Section 2(d) of the ISDA Master Agreement forming part of the
related Above-Cap Liquidity Facility; provided that any such action would not,
in the reasonable judgment of such Person, be materially disadvantageous to
it.  Notwithstanding anything to the
contrary contained herein, but without limiting, and subject to, the rights of
the Subordination Agent hereunder, the obligation of any Above-Cap Liquidity
Provider to make any Above-Cap Payment or pay any Termination Amount shall be
governed exclusively by the applicable Above-Cap Liquidity Facility.


 


ARTICLE VI


 


THE
SUBORDINATION AGENT


 


Section
6.1.            Authorization;
Acceptance of Trusts and Duties. 
Each of the Class G-1 Trustee, the Class G-2 Trustee and the
Class C Trustee hereby designates and appoints the Subordination Agent as
the agent and trustee of such Trustee under the applicable Liquidity Facility
(and, in the case of the Class G-1 Trustee and the Class G-2 Trustee,
the Policy Provider Agreement) and authorizes the Subordination Agent to enter
into the applicable Liquidity Facility (and, in the case of the Class G-1
Trustee and the Class G-2 Trustee, the Policy Provider Agreement) as agent
and trustee for such Trustee.  Each of
the Liquidity Providers, the Policy Provider and the Trustees hereby designates
and appoints the Subordination Agent as the Subordination Agent under this
Agreement.  WTC hereby accepts the
duties hereby created and


 


64

















 


applicable to it as the Subordination Agent and agrees
to perform the same but only upon the terms of this Agreement and agrees to
receive and disburse all monies received by it in accordance with the terms hereof.  The Subordination Agent shall not be
answerable or accountable under any circumstances, except (a) for its own
willful misconduct or gross negligence (or ordinary negligence in the handling
of funds actually received by it in accordance with the terms hereof or any
Operative Agreement), (b) as provided in Sections 2.2 and 5.3 hereof
and (c) for liabilities that may result from the inaccuracy of any
representation or warranty of the Subordination Agent made in its individual
capacity in any Operative Agreement. 
The Subordination Agent shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Subordination Agent, unless
it is proved that the Subordination Agent was negligent in ascertaining the
pertinent facts.


 


Section 6.2.            Absence of Duties.  The Subordination Agent shall have no duty
to see to any recording or filing of this Agreement or any other document, or
to see to the maintenance of any such recording or filing.


 


Section
6.3.            No
Representations or Warranties as to Documents.  The Subordination Agent in its individual
capacity does not make nor shall be deemed to have made any representation or
warranty as to the validity, legality or enforceability of this Agreement or
any other Operative Agreement or as to the correctness of any statement
contained in any thereof, except for the representations and warranties of the
Subordination Agent, made in its individual capacity, under any Operative
Agreement to which it is a party.  The
Certificateholders, the Trustees, the Liquidity Providers and the Policy
Provider make no representation or warranty hereunder whatsoever.


 


Section
6.4.            No
Segregation of Monies; No Interest. 
Any monies paid to or retained by the Subordination Agent pursuant to
any provision hereof and not then required to be distributed to any Trustee,
any Liquidity Provider or the Policy Provider as provided in Articles II
and III hereof or deposited into one or more Trust Accounts need not be
segregated in any manner except to the extent required by such Articles II
and III and by law, and the Subordination Agent shall not (except as
otherwise provided in Section 2.2 hereof) be liable for any interest
thereon; provided, however, that any payments received or applied hereunder by
the Subordination Agent shall be accounted for by the Subordination Agent so
that any portion thereof paid or applied pursuant hereto shall be identifiable
as to the source thereof.


 


Section
6.5.            Reliance;
Agents; Advice of Counsel.  The
Subordination Agent shall not incur liability to anyone in acting upon any
signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper believed by it to
be genuine and believed by it to be signed by the proper party or parties.  As to the Pool Balance of any Trust as of
any date, the Subordination Agent may for all purposes hereof rely on a
certificate signed by any Responsible Officer of the applicable Trustee, and
such certificate shall constitute full protection to the Subordination Agent
for any action taken or omitted to be taken by it in good faith in reliance
thereon.  As to any fact or matter
relating to the Liquidity Providers, the Policy Provider or the Trustees the
manner of ascertainment of which is not specifically described herein, the
Subordination Agent may for all purposes hereof rely on a certificate, signed
by any Responsible Officer of the applicable Liquidity Provider, Policy
Provider or Trustee, as the case may be, as to such fact or matter, and such
certificate shall


 


65

















 


constitute full protection to the Subordination Agent
for any action taken or omitted to be taken by it in good faith in reliance
thereon.  The Subordination Agent shall
assume, and shall be fully protected in assuming, that each of the Liquidity
Providers, the Policy Provider and each of the Trustees are authorized to enter
into this Agreement and to take all action to be taken by them pursuant to the
provisions hereof, and shall not inquire into the authorization of each of the
Liquidity Providers, the Policy Provider and Trustees with respect
thereto.  In the administration of the
trusts hereunder, the Subordination Agent may execute any of the trusts or
powers hereof and perform its powers and duties hereunder directly or through
agents or attorneys and may consult with counsel, accountants and other skilled
persons to be selected and retained by it, and the Subordination Agent shall
not be liable for the acts or omissions of any agent appointed with due care or
for anything done, suffered or omitted in good faith by it in accordance with
the advice or written opinion of any such counsel, accountants or other skilled
persons.


 


Section
6.6.            Capacity
in Which Acting.  The
Subordination Agent acts hereunder solely as agent and trustee herein and not
in its individual capacity, except as otherwise expressly provided in the
Operative Agreements.


 


Section 6.7.            Compensation.  The Subordination Agent shall be entitled to
reasonable compensation, including reimbursement for reasonable expenses and
disbursements, except with respect to any Unindemnified Taxes incurred by the
Subordination Agent in connection with the transactions contemplated by this
Agreement for all services rendered hereunder and shall have a priority claim
to the extent set forth in Article III hereof on all monies collected
hereunder for the payment of such compensation (other than any Unindemnified
Taxes), to the extent that such compensation shall not be paid by others.  The Subordination Agent agrees that it shall
have no right against any Trustee, Liquidity Provider or the Policy Provider
for any fee as compensation for its services as agent under this
Agreement.  The provisions of this Section 6.7
shall survive the termination of this Agreement.


 


Section 6.8.            May Become
Certificateholder.  The
institution acting as Subordination Agent hereunder may become a
Certificateholder and have all rights and benefits of a Certificateholder to
the same extent as if it were not the institution acting as the Subordination
Agent.


 


Section 6.9.            Subordination
Agent Required; Eligibility. 
There shall at all times be a Subordination Agent hereunder which shall
be a bank, trust company, corporation or other financial institution organized
and doing business under the laws of the United States of America or of any
State or the District of Columbia having a combined capital and surplus of at
least $100,000,000 (or the obligations of which, whether now in existence or
hereafter incurred, are fully and unconditionally guaranteed by a corporation
organized and doing business under the laws of the United States of America,
any State thereof or of the District of Columbia and having a combined capital
and surplus of at least $100,000,000), if there is such an institution willing
and able to perform the duties of the Subordination Agent hereunder upon
reasonable or customary terms.  Such
Person shall be a citizen of the United States and shall be authorized under
the laws of the United States or any State thereof or of the District of
Columbia to exercise corporate trust powers and shall be subject to supervision
or examination by federal, state or District of Columbia authorities.  If such Person publishes reports of condition
at least annually, pursuant to law or to the requirements of any of the
aforesaid supervising or examining


 


66

















 


authorities, then, for the purposes of this
Section 6.9, the combined capital and surplus of such Person shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published.


 


In case at any
time the Subordination Agent shall cease to be eligible in accordance with the
provisions of this Section, the Subordination Agent shall resign immediately in
the manner and with the effect specified in Section 8.1.


 


Section
6.10.          Money
to Be Held in Trust.  All
Equipment Notes, monies and other property deposited with or held by the
Subordination Agent pursuant to this Agreement shall be held in trust for the
benefit of the parties entitled to such Equipment Notes, monies and other
property.  All such Equipment Notes,
monies or other property shall be held in the Trust Department of the
institution acting as Subordination Agent hereunder.


 


ARTICLE VII


 


INDEMNIFICATION
OF SUBORDINATION AGENT


 


Section 7.1.            Scope of
Indemnification.  The Subordination
Agent shall be indemnified hereunder to the extent and in the manner described
in Section 9.1 of the Participation Agreements and Section 6 of the
Note Purchase Agreement.  The
indemnities contained in such Sections of such agreements shall survive
the resignation or removal of the Subordination Agent and the termination of
this Agreement.


 


ARTICLE VIII


 


SUCCESSOR
SUBORDINATION AGENT


 


Section 8.1.            Replacement
of Subordination Agent; Appointment of Successor.  The Subordination Agent may resign at any
time by so notifying each Trustee, each Liquidity Provider and the Policy
Provider.  The Controlling Party may
remove the Subordination Agent for cause by so notifying the Subordination
Agent and may appoint a successor Subordination Agent.  The Controlling Party shall remove the
Subordination Agent if:


 


(1)           the Subordination Agent fails to
comply with Section 6.9 hereof;


 


(2)           the Subordination Agent is adjudged
bankrupt or insolvent or files a bankruptcy petition;


 


(3)           a receiver or other public officer
takes charge of the Subordination Agent or its property; or


 


(4)           the Subordination Agent otherwise
becomes incapable of acting.


 


If the
Subordination Agent resigns or is removed or if a vacancy exists in the office
of Subordination Agent for any reason (the Subordination Agent in such event
being referred to herein as the retiring Subordination Agent), the Controlling
Party shall promptly appoint a successor Subordination Agent.


 


67

















 


A successor
Subordination Agent shall deliver (x) a written acceptance of its
appointment as Subordination Agent hereunder to the retiring Subordination
Agent and (y) a written assumption of its obligations hereunder and under
each Liquidity Facility and the Policy Provider Agreement to each party hereto,
upon which the resignation or removal of the retiring Subordination Agent shall
become effective, and the successor Subordination Agent shall have all the
rights, powers and duties of the Subordination Agent under this Agreement.  The successor Subordination Agent shall mail
a notice of its succession to the Liquidity Providers, the Policy Provider and
the Trustees.  The retiring Subordination
Agent shall promptly transfer its rights under each of the Liquidity Facilities
and all of the property held by it as Subordination Agent to the successor
Subordination Agent.


 


If a successor
Subordination Agent does not take office within 60 days after the retiring
Subordination Agent resigns or is removed, the retiring Subordination Agent or
one or more of the Trustees may petition any court of competent jurisdiction
for the appointment of a successor Subordination Agent.


 


If the
Subordination Agent fails to comply with Section 6.9 hereof (to the extent
applicable), one or more of the Trustees, one or more of the Liquidity
Providers or the Policy Provider may petition any court of competent
jurisdiction for the removal of the Subordination Agent and the appointment of
a successor Subordination Agent.


 


Notwithstanding
the foregoing, no resignation or removal of the Subordination Agent shall be
effective unless and until a successor has been appointed.  No appointment of a successor Subordination
Agent shall be effective unless and until the Rating Agencies shall have
delivered a Ratings Confirmation and, so long as no Policy Provider Default has
occurred and is continuing, the Policy Provider shall have consented to such
successor Subordination Agent.


 


ARTICLE IX


 


SUPPLEMENTS
AND AMENDMENTS


 


Section
9.1.            Amendments,
Waivers, Etc.  (a) This
Agreement may not be supplemented, amended or modified without the consent of
each Trustee (acting, except in the case of any amendment pursuant to
Section 3.6(e)(v)(y) hereof with respect to any Replacement Primary
Liquidity Facility, any amendment pursuant to Section 3.6(c)(ii)(z) hereof
with respect to any Replacement Above-Cap Liquidity Facility or any amendment
contemplated by the last sentence of this Section 9.1(a), with the consent
of holders of Certificates of the related Class evidencing interests in the
related Trust aggregating not less than a majority in interest in such Trust or
as otherwise authorized pursuant to the relevant Trust Agreement), the Subordination
Agent, each Liquidity Provider and the Policy Provider; provided, however, that
this Agreement may be supplemented, amended or modified without the consent of
(x) any Trustee or the Liquidity Providers if such supplement, amendment
or modification cures an ambiguity or inconsistency or does not materially,
adversely affect such Trustee or the holders of the related Class of
Certificates or any Liquidity Provider ; provided further, however, that, if
such supplement, amendment or modification (A) would (x) directly or
indirectly modify or supersede, or otherwise conflict with,
Section 2.2(b), Section 2.4(a), Section 2.4(b),
Section 3.2, Section 3.4, Section 3.6(e), Section 3.6(f),
Section 3.6(l), the last sentence of this Section 9.1(a),


 


68

















 


the second sentence of Section 10.6 or this
proviso (collectively, the “JetBlue
Provisions”) or (y) otherwise adversely affect the interests of
a potential Replacement Primary Liquidity Provider or of JetBlue with respect
to its ability to replace any Primary Liquidity Facility or with respect to its
payment obligations under any Operative Agreement or (B) is made pursuant
to the last sentence of this Section 9.1(a), then such supplement,
amendment or modification shall not be effective without the additional written
consent of JetBlue.  Notwithstanding the
foregoing, without the consent of each Certificateholder and each Liquidity
Provider and the Policy Provider, no supplement, amendment or modification of
this Agreement may (i) reduce the percentage of the interest in any Trust
evidenced by the Certificates issued by such Trust necessary to consent to
modify or amend any provision of this Agreement or to waive compliance
therewith, (ii) except as provided in the last sentence of this
Section 9.1(a), modify Section 2.4 or 3.2 hereof, relating to the
distribution of monies received by the Subordination Agent hereunder from the
Equipment Notes or pursuant to the Liquidity Facilities or either Policy or
(iii) modify the definition of “Reserve Amount”.  Nothing contained in this Section shall require the consent
of a Trustee at any time following the payment of Final Distributions with
respect to the related Class of Certificates. 
If the Replacement Primary Liquidity Facility for any Primary Liquidity
Facility in accordance with Section 3.6(e) hereof is to be comprised of
more than one instrument as contemplated by the definition of the term
“Replacement Primary Liquidity Facility”, then each of the parties hereto agrees
to amend this Agreement to incorporate appropriate mechanics for multiple
Primary Liquidity Facilities for an individual Trust.


 


(b)           In the event that the Subordination
Agent, as the registered holder of any Equipment Notes, receives a request for
its consent to any amendment, modification, consent or waiver under such
Equipment Notes, the Indenture pursuant to which such Equipment Notes were
issued or the related Participation Agreement or other related document,
(i) if no Indenture Event of Default shall have occurred and be continuing
with respect to such Indenture, the Subordination Agent shall request
directions with respect to each Series of such Equipment Notes from the Trustee
of the Trust which holds such series of such Equipment Notes and shall vote or
consent in accordance with the directions of such Trustee except that so long
as the Final Distribution on the Class G-1 Certificates and Class G-2
Certificates has not been made or any Policy Provider Obligations remain
outstanding and no Policy Provider Default shall have occurred and be
continuing, the Subordination Agent shall request directions from the Policy
Provider rather than the Class G-1 Trustee with respect to the Series G-1
Equipment Notes held in the Class G-1 Trust or the Class G-2 Trustee
with respect to the Series G-2 Equipment Notes held in the Class G-2 Trust
and (ii) if any Indenture Event of Default shall have occurred and be
continuing with respect to such Indenture, the Subordination Agent will
exercise its voting rights as directed by the Controlling Party, subject to
Sections 4.1 and 4.4 hereof, provided that no such amendment, modification
or waiver shall, without the consent of each affected Certificateholder and
each Liquidity Provider and the Policy Provider (w) reduce the amount of
principal or interest payable by JetBlue under any Equipment Note issued under
any Indenture, (x) modify any of the provisions of Section 10.01, or
of Article II or III or Section 5.01, 5.02(c), 5.02(d), 6.01 or
6.02 of any Indenture, the definitions of “Event of Default,” “Default,”
“Majority in Interest of Note Holders,” “Break Amount,” “Prepayment Premium” or
“Note Holder,” or the percentage of Note Holders required to take or approve
any action under the Indentures, (y) reduce, modify or amend any
indemnities in favor of the Loan Trustee or the Note Holders (except that the
Loan Trustee may consent to any waiver or reduction of an indemnity payable to


 


69

















 


it), or (z) permit the creation of any Lien on
the Collateral (as defined in the relevant Indenture) or any part thereof other
than Permitted Liens (as defined in the Indentures) or deprive any Note Holder
of the benefit of the Lien of such Indenture on the Collateral, except as
provided in connection with the exercise of remedies under such Indenture.


 


Section 9.2.            Subordination
Agent Protected.  If, in the
reasonable opinion of the institution acting as the Subordination Agent
hereunder, any document required to be executed pursuant to the terms of
Section 9.1 adversely affects any right, duty, immunity or indemnity with
respect to it under this Agreement, any Liquidity Facility or the Policy, the
Subordination Agent may in its discretion decline to execute such document.


 


Section
9.3.            Effect
of Supplemental Agreements. 
Upon the execution of any amendment, consent or supplement hereto
pursuant to the provisions hereof, this Agreement shall be and be deemed to be
and shall be modified and amended in accordance therewith and the respective
rights, limitations of rights, obligations, duties and immunities under this
Agreement of the parties hereto and beneficiaries hereof shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental agreement shall be and be deemed to be and shall be part of the
terms and conditions of this Agreement for any and all purposes.  In executing or accepting any supplemental
agreement permitted by this Article IX, the Subordination Agent shall be
entitled to receive at its cost, and shall be fully protected in relying upon,
an opinion of counsel stating that the execution of such supplemental agreement
is authorized or permitted by this Agreement.


 


Section
9.4.            Notice
and Information to Rating Agencies. 
(a) Promptly following its receipt of each amendment, consent,
modification, supplement or waiver contemplated by this Article IX, the
Subordination Agent shall send a copy thereof to each Rating Agency and the
Policy Provider.


 


(b)   Each Rating Agency shall be entitled to the
same access to the Subordination Agent and the Trustees as the
Certificateholders of any Class with respect to information relevant to
maintaining such Rating Agency’s ratings on the Certificates.


 


ARTICLE X


 


MISCELLANEOUS


 


Section 10.1.          Termination
of Intercreditor Agreement. 
Following payment of Final Distributions with respect to each Class of
Certificates and the payment in full of all Liquidity Obligations to the
Primary Liquidity Providers and all Policy Provider Obligations to the Policy
Provider and provided that there shall then be no other amounts due to the
Certificateholders, the Trustees, the Liquidity Providers, the Policy Provider
and the Subordination Agent hereunder or under the Trust Agreements, and that
the commitment of the (i) Liquidity Providers under the Liquidity
Facilities and (ii) Policy Provider under the Policy shall have expired or
been terminated, this Agreement and the trusts created hereby shall terminate
and this Agreement shall be of no further force or effect.  Except as aforesaid or otherwise provided,
this Agreement and


 


70

















 


the trusts created hereby shall
continue in full force and effect in accordance with the terms hereof.


 


Section 10.2.          Intercreditor
Agreement for Benefit of Trustees, Liquidity Providers, the Policy
Provider and Subordination Agent. 
Subject to the second sentence of Section 10.6 and the provisions
of Sections 4.4 and 9.1, nothing in this Agreement, whether express or
implied, shall be construed to give to any Person other than the Trustees, the
Liquidity Providers, the Policy Provider and the Subordination Agent any legal
or equitable right, remedy or claim under or in respect of this Agreement.


 


Section 10.3.          Notices.  Unless otherwise expressly specified or
permitted by the terms hereof, all notices, requests, demands, authorizations,
directions, consents, waivers or documents provided or permitted by this
Agreement to be made, given, furnished or filed shall be in writing, mailed by
certified mail, postage prepaid, or by confirmed telecopy and:


 


	
   

  	
  (i)

  	
  if to the
  Subordination Agent, addressed to at its office at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WILMINGTON TRUST COMPANY

  
	
   

  	
   

  	
  Rodney Square North

  
	
   

  	
   

  	
  1100 N. Market Street

  
	
   

  	
   

  	
  Wilmington, DE  19890-0001

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Corporate Trust Administration

  
	
   

  	
   

  	
  Telecopy:

  	
  (302) 636-4140

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  if
  to any Trustee, addressed to it at its office at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WILMINGTON TRUST COMPANY

  
	
   

  	
   

  	
  Rodney Square North

  
	
   

  	
   

  	
  1100 N. Market Street

  
	
   

  	
   

  	
  Wilmington, DE  19890-0001

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Corporate Trust Administration

  
	
   

  	
   

  	
  Telecopy:

  	
  (302) 636-4140

  
	
   

  	
   

  	
   

  
	
   

  	
  (iii)

  	
  if to the initial
  Primary Liquidity Provider, addressed to it at its office at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  LANDESBANK HESSEN THURINGEN GIROZENTRALE

  
	
   

  	
   

  	
  Main Tower

  
	
   

  	
   

  	
  Neue Mainzer Str. 52-58

  
	
   

  	
   

  	
  60311 Frankfurt am Main

  
	
   

  	
   

  	
  Germany

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Asset Finance

  
	
   

  	
   

  	
  Telephone:

  	
  49-69-9132-4882

  
	
   

  	
   

  	
  Telecopy:

  	
  49-69-9132-4392

  



 


71

















 


	
  with
  a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Landesbank Hessen-Thüringen Girozentrale

  
	
   

  	
   

  	
  420 Fifth Avenue, 24th Floor

  
	
   

  	
   

  	
  New York, NY  10013

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Asset Finance, Gerhard Winklmeier

  
	
   

  	
   

  	
  Telephone:

  	
  212-703-5250

  
	
   

  	
   

  	
  Telecopy:

  	
  (212) 703-5256

  
	
   

  	
   

  	
   

  
	
   

  	
  (iv)

  	
  if to the Above-Cap Liquidity Provider, addressed to
  it at its office at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Morgan Stanley Capital Services, Inc.

  
	
   

  	
   

  	
  Transaction Management Group

  
	
   

  	
   

  	
  1585 Broadway

  
	
   

  	
   

  	
  New York, New York  10036-8293

  
	
   

  	
   

  	
  Attention:

  	
  Chief - Legal Officer

  
	
   

  	
   

  	
  Telecopy:

  	
  212-507-4622

  
	
   

  	
   

  	
   

  
	
   

  	
  (v)

  	
  if to the initial Policy Provider, addressed to it
  at its office at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  MBIA Insurance Corporation

  
	
   

  	
   

  	
  113 King Street

  
	
   

  	
   

  	
  Armonk, New York  10504

  
	
   

  	
   

  	
  Attention:

  	
  Insured Portfolio Management, Structural Finance

  
	
   

  	
   

  	
  Telephone:

  	
  914-273-4949

  
	
   

  	
   

  	
  Telecopy:

  	
  914-765-3163

  



 


Whenever any notice in writing is required to be given by any Trustee,
any Liquidity Provider, Policy Provider or the Subordination Agent to any of
the other of them, such notice shall be deemed given and such requirement
satisfied when such notice is received unless received outside of business
hours, in which case on the open of business on the next Business Day.  A copy of any notice given by the Trustee,
any Liquidity Provider or the Subordination Agent shall be given to the Policy
Provider; provided that the failure to do so shall not impair the validity of
any such notice or the Policy Provider’s obligations hereunder and under the
Policy.  Any party hereto may change the
address to which notices to such party will be sent by giving notice of such
change to the other parties to this Agreement.


 


Section 10.4.          Severability.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


 


Section
10.5.          No
Oral Modifications or Continuing Waivers.  No terms or provisions of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party or other Person against whom enforcement of the


 


72

















 


change, waiver, discharge or termination is sought and
any other party or other Person whose consent is required pursuant to this
Agreement and any waiver of the terms hereof shall be effective only in the
specific instance and for the specific purpose given.


 


Section
10.6.          Successors
and Assigns.  All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
each of the parties hereto and the successors and assigns of each, all as
herein provided.  In addition, the
JetBlue Provisions shall inure to the benefit of JetBlue and its successors and
assigns, and (without limitation of the foregoing) JetBlue is hereby
constituted, and agreed to be, an express third party beneficiary of the
JetBlue Provisions.  Upon the occurrence
of the Transfers contemplated by the Assignment and Assumption Agreements, the
Trustee of each Class shall (without any further act) be deemed to have
transferred all of its rights, title and interest in and to this Agreement to
the trustee of the Successor Trust of the same Class and, thereafter, the
trustee of each Successor Trust shall be deemed to be the “Trustee” of such
Successor Trust with the rights and obligations of a “Trustee” hereunder and
under the other Operative Agreements and each reference to a Trust of any Class
herein shall be deemed a reference to the Successor Trust of such Class.


 


Section 10.7.          Headings.  The headings of the various Articles and
Sections herein and in the table of contents hereto are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.


 


Section 10.8.          Counterpart Form.  This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same agreement.


 


Section 10.9.          Subordination.  (a) As between the Liquidity Providers
and the Policy Provider, on the one hand, and the Trustees and the
Certificateholders, on the other hand, and as among the Trustees, this
Agreement shall be a subordination agreement for purposes of Section 510
of the United States Bankruptcy Code, as amended from time to time.


 


(b)           Notwithstanding the provisions of
this Agreement, if prior to the payment in full to the Primary Liquidity
Providers of all Liquidity Obligations then due and payable and Policy Provider
of all Policy Provider Obligations and any other amounts owed to the Policy
Provider under any Policy Provider Document distributable pursuant to this Agreement,
any party hereto shall have received any payment or distribution in respect of
Equipment Notes or any other amount under the Indentures or other Operative
Agreements which, had the subordination provisions of this Agreement been
properly applied to such payment, distribution or other amount, would not have
been distributed to such Person, then such payment, distribution or other
amount shall be received and held in trust by such Person and paid over or
delivered to the Subordination Agent for application as provided herein.


 


(c)           If any Trustee, any Liquidity
Provider, the Policy Provider or the Subordination Agent receives any payment
in respect of any obligations owing hereunder (or, in the case of the Primary
Liquidity Provider or the Policy Provider, in respect of the Liquidity
Obligations or the Policy Provider Obligations, as the case may be), which is
subsequently invalidated, declared preferential, set aside and/or required to
be repaid to a trustee, receiver or other party, then, to the extent of such
payment, such obligations (or, in the case of the Primary


 


73

















 


Liquidity Provider or the Policy Provider, such
Liquidity Obligations or Policy Provider Obligations, as the case may be)
intended to be satisfied shall be revived and continue in full force and effect
as if such payment had not been received.


 


(d)           The Trustees (on behalf of themselves
and the holders of Certificates), the Liquidity Providers, the Policy Provider
and the Subordination Agent confirm that the payment priorities specified in
Sections 2.4 and 3.2 shall apply in all circumstances, notwithstanding the
fact that the obligations owed to the Trustees and the holders of Certificates
are secured by certain assets and the Liquidity Obligations and Policy Provider
Obligations may not be so secured.  The
Trustees expressly agree (on behalf of themselves and the holders of
Certificates) not to assert priority over the holders of Liquidity Obligations
or Policy Provider Obligations (except as specifically set forth in
Sections 2.4 or 3.2) due to their status as secured creditors in any
bankruptcy, insolvency or other legal proceeding.


 


(e)           Each of the Trustees (on behalf of
themselves and the holders of Certificates), the Primary Liquidity Providers,
the Policy Provider and the Subordination Agent may take any of the following
actions without impairing its rights under this Agreement:


 


(i)            obtain
a Lien on any property to secure any amounts owing to it hereunder, including,
in the case of the Primary Liquidity Providers and the Policy Provider, the
Liquidity Obligations or the Policy Provider Obligations, as the case may be,


 


(ii)           obtain
the primary or secondary obligation of any other obligor with respect to any
amounts owing to it hereunder, including, in the case of the Primary Liquidity
Providers and the Policy Provider, any of the Liquidity Obligations or the
Policy Provider Obligations, as the case may be,


 


(iii)          renew,
extend, increase, alter or exchange any amounts owing to it hereunder,
including, in the case of the Primary Liquidity Providers and the Policy
Provider, any of the Liquidity Obligations or the Policy Provider Obligations,
as the case may be, or release or compromise any obligation of any obligor with
respect thereto,


 


(iv)          refrain
from exercising any right or remedy, or delay in exercising such right or
remedy, which it may have, or


 


(v)           take
any other action which might discharge a subordinated party or a surety under
applicable law;


 


provided, however, that the taking of any such actions by any of the
Trustees, the Primary Liquidity Providers, the Policy Provider or the
Subordination Agent shall not prejudice the rights or adversely affect the
obligations of any other party under this Agreement.


 


Section 10.10.        Governing Law.  THIS AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.


 


74

















 


Section 10.11.        Submission
to Jurisdiction; Waiver of Jury Trial; Waiver of Immunity.  (a) Each of the parties hereto hereby
irrevocably and unconditionally:


 


(i)            submits
for itself and its property in any legal action or proceeding relating, to this
Agreement or any other Operative Agreement, or for recognition and enforcement
of any judgment in respect hereof or thereof, to the nonexclusive general
jurisdiction of the courts of the State of New York, the courts of the United
States of America for the Southern District of New York, and the appellate
courts from any thereof;


 


(ii)           consents
that any such action or proceeding may be brought in such courts, and waives
any objection that it may now or hereafter have to the venue of any such action
or proceeding in any such court or that such action or proceeding was brought
in an inconvenient court and agrees not to plead or claim the same;


 


(iii)          agrees
that service of process in any such action or proceeding may be effected by
mailing a copy thereof by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to each party hereto at its address set
forth in Section 10.3 hereof, or at such other address of which the other
parties shall have been notified pursuant thereto; and


 


(iv)          agrees
that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other
jurisdiction.


 


(b)           EACH OF THE PARTIES HERETO HEREBY
AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE RELATIONSHIP THAT IS
BEING ESTABLISHED, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims.  Each of the parties warrants and represents
that it has reviewed this waiver with its legal counsel, and that it knowingly
and voluntarily waives its jury trial rights following consultation with such
legal counsel.  THIS WAIVER IS
IRREVOCABLE, AND CANNOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT.


 


(c)           Each Primary Liquidity Provider
hereby waives any immunity it may have from the jurisdiction of the courts of
the United States of America or any State and waives any immunity any of its
properties located in the United States of America may have from attachment or
execution upon a judgment entered by any such court under the United States
Foreign Sovereign Immunities Act of 1976 or any similar successor legislation.


 


*  
*   *


 


75

















 


IN
WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, as of the day and year first above written, and acknowledge that
this Agreement has been made and delivered in the City of New York, and
this Agreement has become effective only upon such execution and delivery.


 


	
   

  	
  WILMINGTON TRUST COMPANY,

  
	
   

  	
  not in its individual
  capacity but solely as

  Trustee for each of the Trusts

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Janel R. Havrilla

  	
   

  
	
   

  	
   

  	
  Name: Janel R. Havrilla

  
	
   

  	
   

  	
  Title:  Financial Services Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LANDESBANK HESSEN-THÜRINGEN

  GIROZENTRALE, as Class G-1 Primary

  Liquidity Provider, Class G-2 Primary

  Liquidity Provider and Class C Primary

  Liquidity Provider

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marion
  Kohrsmeier-Hartmann

  	
   

  
	
   

  	
   

  	
  Name: Marion
  Kohrsmeier-Hartmann

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Astrid Horn

  	
   

  
	
   

  	
   

  	
  Name: Astrid Horn

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  MORGAN STANLEY CAPITAL

  SERVICES INC., as Class G-1 Above-Cap

  Liquidity Provider, Class G-2 Above-Cap

  Liquidity Provider and Class C Above-Cap

  Liquidity Provider

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nina C. Simmons

  	
   

  
	
   

  	
   

  	
  Name: Nina C. Simmons

  
	
   

  	
   

  	
  Title:   Vice President

  



 


76

















 


	
   

  	
  MBIA INSURANCE CORPORATION,

  as Policy Provider

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adam M. Carta

  	
   

  
	
   

  	
   

  	
  Name: Adam M. Carta

  
	
   

  	
   

  	
  Title:   Assistant Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  WILMINGTON TRUST COMPANY,

  not in its individual capacity except as

  expressly set forth herein but solely as

  Subordination Agent and Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Janel R. Havrilla

  	
   

  
	
   

  	
   

  	
  Name: Janel R. Havrilla

  
	
   

  	
   

  	
  Title:   Financial Services Officer

  



 


77

















 


SCHEDULE 2.02(b)


 


Upon the funding
of any Above-Cap Account or Above-Cap Reserve Account or the maturity or
redemption of any investment of funds in any such account (such funds, the “Funds”), the relevant Above-Cap Liquidity
Provider shall send a notice to the Subordination Agent containing a list of
Eligible Investments (the “Specified
Investments”) which shall contain at least 10 investments in open
market commercial paper of corporations incorporated under the laws of the
United States of America or any state thereof.


 


Following receipt
of such notice, the Subordination Agent shall use its best efforts to invest or
reinvest the Funds in any Specified Investment.  If no Specified Investment is then available, the Subordination
Agent shall invest or reinvest the Funds in any other Eligible Investment
selected by the Subordination Agent.


 


Following such
investment or reinvestment of the Funds by the Subordination Agent in any
Specified Investment or other Eligible Investment, the Subordination Agent
shall deliver a written statement to the relevant Above-Cap Liquidity Provider
setting forth for each such Specified Investment or Eligible Investment the
CUSIP number or other similar number for such obligation (or, if such
obligation does not have such a number, (i) the name of the issuer,
(ii) its maturity date, (iii) its yield or rate of return, and
(iv) its rating, if rated by any nationally recognized rating agency).


 


1

















 


EXHIBIT A


 


JetBlue Airways Corporation


Pass Through Certificates, Series 2004-1


As of [ ] Unless Otherwise
Noted; All Amounts in $


 


Aircraft
Summary


 


	
  Registration

  Number

  	
   

  	
  Section
  1110

  Status*

  	
   

  	
  Operating
  Status**

  	
   

  	
  Maintenance
  Status***

  	
   

  	
  Location
  of Engines

  	
   

  	
  Aircraft
  Information

  Services Inc.

  (dd-mmm-yy)

  	
   

  	
  AvSolutions

  (dd-mmm-yy)

  	
   

  	
  Morten
  Beyer & Agnew

  (dd-mmm-yy)

  
	
  N586JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N587JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N588JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N589JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N590JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N591JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N592JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N593JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N594JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N595JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N597JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N598JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N599JB

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [mmm-yy]

  	
   

  	
  [City,
  Country]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  



 












*Section 1110 Status Key


**Aircraft is (1) in service,
(2) in storage or (3) scrapped


( A ) Subject to the 60-day period of
Section 1110 of the Bankruptcy Code


( B ) Subject to an election by JetBlue
under Section 1110(a) of the Bankruptcy Code


( C ) Covered by an agreement contemplated
by Section 1110(b) of the Bankruptcy Code


( D ) Not subject to either ( A ), ( B ), (
C )


*** Next scheduled heavy check


 


1